So, you're thinking of selling your home? Determining its value is one of the early steps in the selling process. And it is VERY important to get right. See below for a discussion of why this is so crucial. There is a narrow margin between getting the most for your property without asking too much and getting what's appropriate for your property without asking too little. There are several ways to determine the value of a home:

Pricing Your Home

  • A Comparable Market Analysis (CMA) is an estimate of market value performed by a real estate agent based on similar homes' sale prices. Other factors such as how long it took similar homes to sell, originally-listed-price to actual-sale-price ratios, condition and asking price history will all be taken into consideration when preparing a CMA and determining an asking price for your home. A good agent will spend several hours working on your CMA. If you are interested in obtaining a free CMA I would be happy to provide you one. Just click the link or call to provide me some information about your home. I can also give you listing information for houses that are currently on the market for sake of comparison - although these should not be relied on too heavily since a sales price is not yet established. An asking price is a seller's advertised price, a figure that usually is only a rough estimate of what the house will actually sell for. Some sellers choose an asking price higher, lower or close to what they hope to get. See below for a few pros and cons of each approach.
  • You can also use Public Records to try to determine your home's market value on your own. In the Seattle area there are a number of website that provide public information about home selling prices and basic stats all derived from King County's public records. Please see my Resources page. When someone buys a home the property is deeded from the seller to the buyer and the deed is recorded with the King County's Recorders Office. These records usually contain sales price, house and lot square footage and number of bed and bathrooms. However many times the square footage is stated incorrectly - sometimes including basement square footage and sometimes not for example. The online county records also lag 1 to 2 months behind actual home sales. These sites also provide very limited information and do not tell you about the condition and quality of the comparable properties. You can drive by and view the exterior, but only a real estate agent or an appraiser would have access to information about the interior. This information is contained in the MLS - a database of active and sold properties with pictures, descriptions, correct square footage and many details about the home that you cannot find elsewhere.
  • An appraisal is a professional estimate of a property's market value based on recent sales of comparable properties, location, square footage and various other factors. This service is performed by a professional appraiser and generally costs $300-400. Lenders require appraisals as part of the loan process. When you are selling, your buyer will generally need to have an appraisal done of your home. They will pay the cost for this.

No matter how much investigating you do yourself, when you're ready to sell you should get a professional opinion about your home's value. Agents and appraisers have experience doing this as a business and know the market and nuances about value. Again, I'd be happy to provide you a Comparable Market Analysis.


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Price - The Crucial Factor

No single factor has more impact on the successful sale of your property than pricing. The price at which you choose to list your home will determine whether or not your home sells in a timely fashion, or sits on the market. It's a given that every home seller wants top dollar for their property, but determining a realistic asking price up front will ensure a quick sale and a great price, and there will also be a greater likelihood of competing offers. A home that's priced too high will sit on the market and after a while people start to wonder "What's wrong with that house? It's been on the market FOREVER!"

In a traditional market, a properly priced home should sell within 30 to 60 days of listing. Not only will an over-priced home take longer to sell, it is also likely to sell for less than it's actual value. Buyers tend to discount listings with longer than average market times. Typically, the seller realizes that it is fruitless and often times costly to continue asking for such a high price, reduces the price and eventually sells the home, sometimes for less than the revised asking price. Obviously, pricing your home to low will result in less money in your pocket. A balance between value and price must be found.

When pricing your home consider:

  • There is no such thing as an "exact price" in real estate.
  • An agent does not determine the "worth" of your home, the market determines the value. An agent just utilizes an in-depth knowledge of the market to reasonably assess what price the market will bear for your home.
  • The majority of showings by agents on a new listing occur within the first week or two that the house is placed on the market. Once this group has seen the property, showing activity decreases primarily to only those buyers new to the market. Therefore, it is important to position your home at the best price during its first market exposure. "There is no second chance to make a first impression."
  • Buyers decide what to purchase by shopping, comparing and selecting the best value they can find. If your home is overpriced, it may be used to make competing listings seem more attractive.

So how do you know what the right price is? Price is determined by several key factors:

  • Location
  • Condition
  • Style
  • Comparable Properties
  • Market Conditions and the Economy

An experienced real estate agent will take all these factors into consideration in determining a realistic asking price for your home. Remember, there is a narrow margin between getting the most for your property without asking too much and getting what's appropriate for your property without asking too little. Beware of agents whose opinion of value is considerably higher than others. They are probably just trying to get your business and will end up lowering the price once it's on the market anyway. It is important to make sure the price is attractive enough to still attract serious offers. You need an agent that will spend the time involved in getting the CMA right - someone who understands just how crucial that initial market price is. I'm happy to provide a complimentary Comparable Market Analysis for you. Besides, whether you're interested in moving now, three months from now, or three years from now, it's helpful information to have.

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Jessica was a dream Realtor! She took the time to understand what we wanted, worked with our busy schedules to view houses, and then when it came time to put in an offer and throughout the entire purchasing process, she educated and "held our hand" through it! We felt that she always had our best interest at heart and that she kept us in the loop through the whole process. We HIGHLY recommend having Jessica as a Realtor!

April 2013
Bothell
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