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Determining Property Value

  1. Is the home ‘dated’ or ‘updated’ with things like new windows from a website like this one? It is a sad reality that a state-of-the-art home today can be harshly criticized 10-15 years later. Homes have become like wardrobes; you do not have to update them but it will be noticed if you do not, and talked about negatively.

  2. Is the property well maintained? Except for investors who are eager to improve homes for large profits, most buyers want a home that has been loved and cared for. Deferred maintenance issues frequently kill deals during the inspection phase, or cost the seller money to fix problems before closing. Unfinished remodeling or overdue maintenance is expensive to a seller. If for example, the roof is due to be redone, this can look really unappealing to a buyer as roofs are expensive to replace and maybe something they are unable to do after moving into the property. As a home seller, you could contact and search for Denver roofing companies or local roofing contractors to see if anyone can possibly help you with quickly solving this if it was an issue.

  3. Is the home attractively decorated and furnished? Proper staging is an art. Not staging a home will cost you showings, perhaps offers, and likely money during the negotiations. A well-presented house may net you more money, or it could just make the home more saleable, meaning it will sell quicker because it competes better against other properties. Appropriate condition correlates to the market expectations for the price range. You do not have to follow every home fashion or trend, but you should do what is expected for the price range.

So what should you do?

De-clutter. Less is always more. Pack up everything you can live without and store the boxes in the garage, shop, or a storage facility. Remove unnecessary furniture to open-up walkways creating a home that feels spacious and lighter.

De-personalize. The best showings are when buyers see less of you and YOUR home, and more of them and their new home. Galleries of personal pictures on walls or the refrigerator distract buyers. Create an opportunity for the buyer to mentally place themselves and their furniture in your home. Selling your home is not about you – it is about your buyers. You are not showing off your possessions or family, instead you want buyers to envision themselves in your home and to imagine what they could do with your home-canvass.[/accordion] [accordion title=”Appraised Value and Lenders”]The reality is that most properties are purchased by a lender on a buyer’s behalf. Because of the risk to the lender of having to take back the property and re-sell it, the issue is really about what a lender is willing to pay. The lender will not pay more than the current dictates of the marketplace. In a declining market those assessments will be very conservative as they hedge against future lower prices. The data that is used to analyze the market is the actual sold comparables. ‘Solds’ alone have authority to establish value. The closest sales geographically, statistically, and chronologically are used to establish value. A seller’s opinion (they usually love the property) and a buyer’s willingness to pay the price (they also love it) mean nothing to a lender.

Professional technicians (appraisers) are hired by the bank to determine the value of your property. Your Realtor’s job and primary goal is to understand the market and your property well enough to price your property so that it does not conflict with an appraisal. There is no worse feeling than being 3 weeks into a transaction and having the appraiser come in thousands of dollars under the agreed-upon price. Most buyers cannot, and will not, pay more than the appraised value. In this situation, the seller always feels violated and must drop the price. It is a bitter experience.[/accordion] [accordion title=”The Marketplace is the last court of appeals”]You may list your property at a verifiable and attractive price but still not get an offer. A lack of showings might communicate that people think the property is overpriced. It also might be that there are no buyers in the marketplace at this time. If that is the real problem, then dropping the price will do no good, and plenty of damage. It will get you less money and bring down property values in the neighborhood. An experienced professional will know how to test and discern the causes. Other factors include the property’s location, condition, or presentation by the Realtor .

Markets do change, sometimes suddenly. Bank-owned homes, short-sale properties, and discouraged and desperate sellers can cause prices to drop suddenly making your property appear over-priced. The ‘active comparables’ while not definitive for appraisals, must be closely watched because they are your competition. Sellers should know their competition and learn to think like buyers, not sellers! You do not need to be the lowest price on the market, but you must be the best value, or at least unique enough so that your particular kind of buyer will want your home even at a higher price.[/accordion] [accordion title=”Overwhelmed & Hopeless? “]No one has the perfect property. There are many things we cannot control (like gravel roads, a poorly managed rental in the neighborhood, a funky floor plan, etc.). Additionally, some sellers cannot afford the time or money to change things that could be improved. This does not mean you cannot get your home sold, it just means that the price should reflect all these issues in order to keep your home strategically competitive. Your Realtor will be able to do this for you and periodically track your property against changing market conditions.

Buyers are savvy, and in this age of instant and vast information they will know your property and the competition well before they write an offer. Buyers will not be fooled. But the good news is that they also will recognize your good value. Their desire for good value and your desire to take the market seriously and offer a good value will eventually be a win-win deal. At that point both of you can move on with your lives.[/accordion] [/accordion_group]

Published on: Nov 30, 2012

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