Posts Tagged ‘homes comps’

Homes Comps: Determining Your Listing Price and Home’s Value

Thursday, May 8th, 2008

: Determining Your Listing Price and Home’s Value

When it comes to buying a home, most buyers will use the listing price to determine the homes search online, that they look search. Even though you and a real estate agent may determine the asking price, the buyer will determine the selling price. If the price is too high, most buyers won’t give it a second thought, but should negotiate in a soft market.

If you are a seller and set the correct price, you’ll notice a much faster sale. Setting the right listing price will also attract more potential buyers to your house as well. You’ll notice an increase in response from real estate agents in the showings you’ll receive more calls about the property. The listing price is very important, if you are off by a lot it can become stale and the longer the days on the market the fewer showings you may get. It could make the difference of whether you sell or not.

A home may be over priced due to several reasons. Over pricing is something you want to avoid, buyers tend to steer clear of homes that have been over priced. This happens when a seller asks a lot more than the home is worth or valued at. Some sellers ask a lot more than the value of the home due to location. Location is very important, most potential buyers won’t give the home a second look if they think the price is too high, or out of their price range.

When you put your home up for sale, most activity will happen within the first couple of weeks. price the home right for the most interest. Buyers are waiting on new houses to hit the market all the time.

Determine the listing price of your home. In this market you may want to have it appraised first. This way you’ll know the full value of your home. Real estate agents will do a CMA (Cost Market Analysis) for you if you ask them to possibly before you list it. You can sell it for market value or go a little under, although you should never attempt to go way over the value. In doing so, you’ll miss out on a lot of potential buyers and showings, and buyer’s agents showing your property to prospects. The home market is very competitive these days, which is why you want your home to draw as much interest as possible.

Agents really have no control at all over the real estate market, only the plan behind the marketing.
Real estate agents will suggest a list price. You can ask an agent for advice. If you do things right and take each thing step by step. If you are looking into listing your home, I can have an associate agent contact you.

If you have questions about real estate at anytime please email me ron@minnesotainvestors.com

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Homes Comps: Determining Your Home’s Selling Price

Tuesday, April 29th, 2008

What are ? Comps mean comparables. Comps are what agents and seller’s use to compare the selling prices of recently sold comparable properties in the surrounding areas. Real estate agents will use these recent to determine what to list a house for. Agents will do what is called a CMA-Cost Market Analysis. Agents typically do this in the beginning when meeting a seller. It may be part of their listing presentation to tell you what they think they house should be listed for before they would list the house on the MLS-Multiple Listing Service. In today’s market most lenders will ask for more recent comps (3 months or less), some will allow 6 months since last sold. Prior to 2007, lenders often allowed that were 1 years old. As the market has changed, most lenders have asked that be as recent as 3 months old or less. Some will allow for 1-2 that are up to 6 months old. Each lender will be different. Also in situations where lenders see that a seller is behind in payments and believe a foreclosure is coming up soon, they will order
3 BPO’s, from 3 different agent/brokers. BPO’s are Broker Price Opinions. These are more like CMA’s without the complete work of an appraisal. The reason is lenders probably want to save the money, plus they want 3 local agents to give their opinion, as the lenders are almost always from another state. are best data to find out what your
house will probably sell for.

As a general rule the other properties has to be pretty close to the same house as yours. For example if you have a rambler, the appraiser or agent would compare other ramblers. They would try to stay within a few years of yours, same bedrooms, same garage stall, same square feet “above ground”. You can’t always find exact matches, so the appraiser or agent may make small adjustments to make a more fair comparison. The type of house, year built, condition, sq ft, and bedroom are going to be most of the most important things to compare fairly. Of course if the house is on the lake, you’d have to compare it against other similar lake homes in the area. Please don’t get caught up in the type of trim work, countertops, appliances, etc, that doesn’t make a very big difference when an appraiser or agent compares properties. Some properties just have better curb appeal and curb appeal is something just comes from experience. Curb appeal means it looks good from the street when you drive up to the property from the street, it obviously looks nicer than
the other house that has the same specs on paper. You can try to find online, but as an agent/broker, I really think the best data is from the MLS, and I would really leave it to an agent.

Typically a buyer is the one that’s going to order an appraisal, usually not the seller. The value of a property is what someone is willing to pay for the property. As of 2008, I would like to be more specific and say it’s what someone will pay, and what a lender’s appraisal review department is willing to accept for a value. A lender’s appraiser will come up with their own value. In markets where prices are going down, a lender typically will want to use more recent comps only 3 months old. If you need to find out your houses value, you can contact me, and I can have my agent associate run a CMA for you before they list your house. If we find out that you owe too much on your house, are behind on payments, we may have you talk to a short sale specialist. Please email me at ron@minnesotainvestors.com.

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