The first question a potential home seller has is undoubtedly, “What’s my home worth?”
A real estate professional will establish the likely selling price by doing a comparative market analysis (CMA) – comparing your home to others like it that have sold recently. We would include market conditions, such as the inventory of homes for sale and the ease of purchase (interest rates, mortgage availability).
Ideally, your agent will be looking for homes
- of similar size;
- in similar condition;
- in the same or a nearby neighborhood; and
- sold in the past three months.
In a large subdivision or condo complex with many recent sales, this can be fairly easy. If your home is very similar to several recently closed sales, except for the level of improvements, adjustments can be made for the various differences.
It is more difficult to establish market value when there are few or no comparable sales (“comps”). Sometimes your home is unique compared with nearby homes sold recently. In this situation establishing a reasonable market value will also be a matter of adjustments, but the adjustments will be trickier.
The most important factor is location, so up to a point we would tend to favor closer homes over more recent sales from a distance. On the other hand, if we can locate several recent sales of similar model homes by the same builder in a distant neighborhood, we can adjust for location.
Adjustments may be made for the home’s “fit” in the neighborhood. A home that “sticks out like a sore thumb” – either too fancy or too big compared to nearby homes, or relatively small or unimproved relative to the neighborhood – will require more up or down adjustment. If the comps are in a more highly sought after school district than your home – or vice versa – it will be necessary to adjust for the schools.
Occasionally we might try multiple approaches. For instance, in addition to pricing recent sales of similar homes from other neighborhoods, we can also research sales in your neighborhood from previous years and then adjust for what has occurred in the local market since then. By establishing the value from several perspectives, a more accurate price range for your home will become clear.
Finally, when a property sells, it’s not just about the price. There are other factors that influence what a buyer will pay and how much a seller will accept:
For example, terms such as these might induce a seller to take less money:
- an all-cash offer (no mortgage contingency to worry about);
- an as-is offer (no concern about repairs);
- a fast closing or a longer closing, depending on what the seller prefers; or
- a free rent back, to allow the seller time to complete his move at a more leisurely pace.
And these terms might make the seller demand more money:
- seller financing all or part of the purchase price;
- seller paying for closing costs; or
- offer contingent on sale of buyer’s home.
If you would like to know the likely market value of your home, please contact me. I’ll be happy to help you evaluate your property’s value.Kim Hannemann, Real Estate Consultant/Realtor®, Samson Realty Cell: 703-861-9234 • Fax: 703-896-5055 • Email: KimTheAgent@gmail.com It’s Good To Have A Friend In The Business®
If you would like to discuss real estate questions, sell or buy a home in Northern Virginia – including Alexandria, Annandale, Arlington, Burke, Centreville, Chantilly, Clifton, Fairfax, Fairfax Station, Falls Church, Kingstowne, Lorton, McLean, Reston, Springfield, or Vienna – contact Kim today.
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