Pricing of Homes
in the Current Market
All of us want to get top
dollar for our home when
it is time to sell. Of all the
tools we have to market
homes, the most important is the price.
Sure, price has always been important, but distressed properties such as "short sales" and bank owned properties have had a great influence on home prices the past few years.
Effect of Distressed Properties
For those that owe more than the market value of their home and need to sell at this time, the only option some may have, is to try to do a "short sale", where the lender agrees to accept a price lower than the balance due on the loan. This adversely affects the market price of all comparable homes, especially if the comparable home is not a distressed sale.
Loss of Equity
Those that must sell at this time and are not underwater with their mortgage are faced with a loss of equity...which can be significant. They have done everything right, but still are faced with competing with pricing influenced by "short sales" and bank owned properties.
There is some redemption in this scenario. If the seller is planning on purchasing another home, the new home will generally have a selling price also influenced by distressed properties, helping to mitigate some of the loss of equity in their home.
Second Homes
For those wanting to sell a second home it can be even more brutal unless the price is set for a fast sale. If the seller is not occupying the home while on the market, the costs of maintaining the home continue until it is sold. These monthly costs such as mortgage payment, property taxes, HOA dues, insurance, utilities, exterior maintenance and other miscellaneous costs rough average of $2,700/month, assuming a mortgage payment of $1,800. Even if the home is paid for there is a similar "loss of investment opportunity" as the original home investment is not available to use for other, and possibly more profitable, uses.
So...How Do You
Price Your Home?
Get a CMA from a Realtor
First and foremost get a "Comparable Market Analysis" for your home from a Realtor familiar with property values at Sun City Shadow Hills. Most Realtors do not charge for this service and there is usually no obligation. A Realtor has access to current information about actual selling and listing prices and can guide you through the process.
Estimate Your Net Proceeds
Make a list of those things that would have to be paid off on the sale of your home such as mortgages, taxes, liens, closing costs etc. Get a payoff balance from your lender. By adding these to the payoff balance you can get an approximation of the amount that would be deducted from the selling price and is your (approx.) net proceeds. A Realtor can help provide many of these items and can help you determine what kind of sale you can expect i.e.
Standard Sale or Short sale. Short sales need to be approved by the lender(s).
Set the Price
It is generally true that we all want to set the price as high as possible. If it is too high above the prices of comparable homes on the market, chances are that there will be little or no activity and no offers. What we recommend is if you want to set your price a bit higher than the comparable properties, do so, but agree that if there is little or no activity for, say 30 days, you will lower the price to the level of the market. It is adviseable to lower the price all at one time with a major price reduction. This will attract the most buyers. If the price is dropped in "baby steps" your house will always be above the market and your costs of maintaining the home will continue.
Keep in Touch
Your close participation in the sale of your home is vital. We want you to be well informed as to what the market is doing so we highly recommend that you sign up for our free MLS search account. This will give you the latest market information such as activity for properties in your neighborhood, new listings, sold properties, selling prices and more. This will offer you the opportunity to see the actual selling prices and compare them with your home's listing price.
Beware, however, that there are many nuances in comparing home values. Consult with us as we keep up on Sun City Shadow Hills listings, pricing, and number of sales on a daily basis.
Music "Remembrance" Courtesy Michael Allen Harrison - From "Live at The Benson" - Visit MAHrecords.com
Bob Darby
Broker
Lic. # 01889940
760-668-2975
Sun City Sellers Guide.com
Carol Glasgow
Assoc. Broker
Lic. # 00906595
760-902-5776
Sun City Shadow Hills
81369 Camino Los Milagros, Indio, CA 92203
Planning to Sell Your Home? - In Today's Market Realistic Pricing is a Must!
The Basic Rule of Real Estate
A Home's Value
is Determined...
...Not by the Builder
...Not by the Realtor
...Not by the County Assessor
...Not by an Appraiser
...and Not by the Seller
…it is Determined Solely
by the Buyer’s Choices of
Other Comparable Properties
Available at theTime of Purchase
Carol Glasgow and Bob Darby will be pleased to provide the information you need to price your home to sell. Send either of us an email and we can help. There is never an obligation.
