This is the most frequently asked question when meeting with prospective clients who are thinking about selling their home. There is no “one size fits all” rule in real estate. A Fair Market Analysis is the one that is used most often in determining a sale price.
Recent comparable sales is a good indicator to work with, but, each property needs to be customized. There are a number of items that need to be taken into consideration. The size of the land and its location–whether on a busy street or a quiet side street can be a serious part of an evaluation.
If a house is updated and a similar house is not it stands to reason that the renovated home will bring in more money. The number of bedrooms and bathrooms will also be a key factor in determining the sale price.
An attached 2 car garage is worth more than one detached and at the rear of the property. Updated electricity, age of roof, replacement windows, and heating system/hot water heater, air-conditioning systems or window units, all are factors in this formula. Another consideration is the fuel used, whether oil or gas, and if there is an oil tank in or under the premises.
Another important part of this formula is curb appeal and the maintenance of the premises. An immaculate non-renovated home will sell faster than one that is updated but doesn’t show well. The pride of ownership has to shine.
Taking all these items into account is important, however, the pulse of the real estate market will determine the sales. When it’s a buyer’s market the sellers have to adjust their expectations or the house will not sell. When it’s a seller’s market, with very little inventory, the buyers may have to pay more than they expected to.
Our emotions also have to be accounted for. Some sellers have a price in mind and will not budge regardless if that price is unrealistic. Water seeks its level and so does the housing market. If a house is overpriced, it will take longer to sell. There are some houses that are on the market now that are priced less than the offers they were presented months or even years ago.
If a house is on the market for over a year, the prospective buyers want to know what’s wrong with it. I try to tell them that the sellers have refused offers and that there is nothing wrong with the house.
Often, the location of a house means more to some buyers than others. If someone wants to be in walking distance to a house of worship, there are premiums to pay for that.
A good public school system will show stronger sale prices than a less stellar system in other towns.
Transportation and proximity to highways for easy commuting can also be important.
Last but not least, financing from banks or mortgage brokers can make or break a sale. Keeping financial records in order, getting a pre-approval, and raising your credit score will make a difference when presenting an offer. Sellers may take a lower price if there is a stronger contract from a prospective buyer than an offer that may be shaky.
Real estate markets change with the seasons. The economic pulse of the nation can change with adverse conditions around the world. Appraisers and banks may ask for property to be reassessed every six months. We are at the mercy of the economy and must be willing to adjust our expectations in order to get the best possible price at the time.
Martha (Malkie) Aaron has been a broker and salesperson for over 30 years and is affiliated with the Englewood office of Anhalt Realty. She can be reached at: (201) 568-3300.
By Martha (Malkie) Aaron