Testini Real Estate

 

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There is no set equation to determine how you’ll reach an offer price. Rather, the process involves a range of research and comparison that will vary with each situation. You’ll need to look at sales of comparable properties, and factor in additional data such as the condition of the property, the current market, and seller circumstances. With this information in hand, you will be able to determine a fair price range and, from there, establish the price you’re willing to offer. 


Concentrate on the following areas to help you determine an offer price: 


Comparable Sales 

• Compare prices of homes that are similar to the property you’re considering in the following areas: number of bedrooms and bathrooms, square footage, lot size, type of construction, and garage space. 

• The most comprehensive and in-depth information can be accessed through the Multiple Listing Service (MLS).

 

Your Realtor, who will be working closely with you to set your offer price, can help you navigate this service. 

 

Property Condition 

• Observe how the property compares to the rest of the neighbourhood. Is it average, above average, or below average? 

• Look at structural condition: walls, ceilings, windows, floors, doors. 

• Pay close attention to: bathrooms, bedrooms, condition of plumbing and electricity. 

• Also check the fixtures: light switches, doorknobs, drawer handles, etc. 

• What is the condition of the front and back yards? 

 

Home Improvements 

• Cosmetic changes can be largely ignored, but any major improvements should be taken into account. 

• Take special note of: room additions (especially bedrooms and bathrooms). 

• Items such as swimming pools may be taken into account, but usually won’t affect your offer. Your Realtor can offer your guidance in these matters. 

 

Market Conditions 

Seller’s Market: 

 

A seller’s market is considered a “hot” market. This type of market is created when demand is greater than supply—that is, when the number of Buyers exceeds the number of homes on the market. As a result, these homes usually sell very quickly, and there are often multiple offers. Many homes will sell above the asking price. 

 

Buyer’s Market

 

A Buyer’s market is a slower market. This type of market occurs when supply is greater than demand, the number of homes exceeding the number of Buyers. Properties are more likely to stay on the market for a longer period of time. Fewer offers will come in, and with less frequency. Prices may even decline during this period. Buyers will have more selection and flexibility in terms of negotiating toward a lower price. Even if your initial offered price is too low, Sellers will be more likely to come back with a counter-offer. 

 

Balanced Market: 

 

In a balanced market, supply equals demand, the number of homes on the market roughly equal to the number of Buyers. When a market is balanced there aren’t any concrete rules guiding whether a Buyer should make an offer at the higher end of his/her range, or the lower end. Prices will be stable, and homes will sell within a reasonable period of time. Buyers will have a decent number of homes to choose from, so Sellers may encounter some competition for offers on their home, or none at all. 

 

Comparable sales information helps you establish a price range for the home you’re interested in. Adding in the additional factors mentioned above will guide your decision of whether you consider a “fair” price to be near the upper or lower limit—or the middle—of that range. Keep in mind, this price should be the one you’d be happy with once all negotiations are said and done. The price you decide to begin with depends on your particular style of negotiation. Most Buyers begin the negotiation process with a number lower than the “fair” price they’ve come up with.

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Don’t get discouraged if your property hasn’t sold during its first appearance on the market. Your home may actually have been one of the most appealing listings of its kind—and the reasons it didn’t sell may have nothing to do with the property itself or the market. Rather, a number of separate factors may have influenced the outcome. Take a step back, break your original selling method into parts, and allow yourself time to evaluate each one. Make a commitment. Establish a new approach. Stick to it. A reassessment of your system, and a shift in perspective, may be just what you need to realize your ultimate goals in the sale of your home.

If your listing has expired, you will usually find weakness in one of the following areas:


1. Appearance and Condition of your Property


When preparing your home to show to buyers, always remember: the decision to buy a home is one coloured primarily by emotion, not logic. Every buyer has different ideas of what “Dream Home” means to them. Of course, your home won’t appeal to every buyer’s palate. But, how prepared are you? Is your home inspiration-worthy? Have you prepared each room with the goal that it leave a lasting impression? Have you cultivated ambiance? For example, when a buyer stands in your kitchen, will she warm to the thought of drinking coffee at the table every morning? Does the décor in the master bedroom inspire feelings of comfort and relaxation? You should make every effort to make you home appear inviting and appealing. This means covering all the bases:


• Take care of any general repairs needed


Tidy away the clutter; every room should appear well-ordered and neat


Maintain a strict level of cleanliness while showing. Everything should be clean, from shelves to carpets to furniture. While you may no longer notice that wine stain on the rug, it could be the first thing a potential buyer sees when she walks into the room.


Increase the brightness and warmth in your home: open curtains, turn on the lights, put out flowers, play soothing background music.


Don’t forget the exterior of the house. Concentrate on the “curb appeal” of your home. What impression will a buyer get when s/he first pulls into the driveway? Keep the lawn well-groomed and the rest of the property tidy.


• Assess any major decorating or renovation projects that your property could be in need of. If your home could use a new paint-job, for example, consider taking care of this yourself, rather than offering a repair allowance to prospective buyers. Don’t leave such changes to their imagination—if they are looking at run-down walls, chances are they will incorporate this flawed experience of your house into the price they’ll be willing to pay. Ultimately, you’re better off checking these projects off the list before showing your home.


A house that is showcased well and offers a lasting impression will sell for the best price, going a step beyond the competition. Be sure to see if your agent will put together a no-obligation examination of your home to assist you in looking at the factors we’ve mentioned.


2. Pricing


The market value of your home is based on the price a willing prospect will pay, as well as the price a willing seller will accept. Pricing your home too high can be as financially dangerous as pricing it too low. Keep in mind, your listing does not include the price you paid originally for your home. Often, sellers include this original price—or the amount of money they’ve invested in their home so far—into their selling price equation. This mistake may prove to be a costly one. Pricing your home too high can result in prospective buyers rejecting your home for larger homes listed at the same price. Ask yourself: did your price work for you or against you? The “right” price balances upon a combination of: competition within the market, the condition of the market, and the state of your home.


Request an up-to-date market analysis from your agent to help give you an idea of what an appropriate asking price for your home might be. This market analysis should give you an idea of the competition involved in the current market, offering an assessment of homes similar to your own that have recently sold or are currently on the market. It should also show you how long other homes have been listed, in order to give you an idea of the average amount of time you can expect a home to stay on the market. And it should indicate the homes with expired listings, to help you glean some understanding of the reasons why this might occur.


3. Marketing and Communication


Your marketing plan begins with choosing the right realtor for your home-selling needs. The realtor you choose should be committed to selling your property, ensuring your home is marketed and showcased in the most effective way possible. So, when interviewing agents, it’s a good idea to ask them to give you a rundown of the marketing strategy they would use to sell your home. Investigate and compare how much money each realtor spends on advertising a property and the types of media s/he employs. How effective is each brand of advertising?

Your real estate agent should recognize the most effective marketing strategy for the unique offerings of your home. S/he should also articulate to you the most direct marketing route to the largest pool of potential buyers. Be wary of agents who rely on outdated advertising strategies. The most successful agents on the market today are those who employ current, innovative marketing techniques. These are the agents you can rely on to have the skills and tools required to sell your home fast and for top dollar.


4. Operating as a Team


Communication between you and your realtor is essential. Your realtor should listen to your needs and goals, and be able to translate these into an active, effective home-selling strategy. Once this strategy has been put into play, you should receive detailed, up-to-date feedback on the status of the sale. Your realtor should be actively involved in every showing, speaking to agents who have shown your home, and relaying this information to you. You should be able to work together to build an effective strategy and alter the course if need be. Evaluate the relationship you had with your realtor while your home was on the market. Did you feel as though your realtor involved you every step of the way? Were you given the information you needed to stay on top of progress? Did your realtor listen to your wishes and concerns and act upon them?


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Selling your home is a complex process that can be stressful and time-consuming. An experienced Realtor has the knowledge, skills, and connections to help you through the process every step of the way. Consider the following benefits of working with a Realtor:

                   

Professional Experience:

                   

With knowledge and training in marketing strategy, negotiation tactics, and the workings of the current real estate market, a Realtor will be able to guide you through the steps of the home-selling process and be able to explain exactly what to expect. S/he will make you aware of your rights and responsibilities, work with you to strategize the best moves according to your own goals, discuss financing options, and point you in the direction of other specialized professionals who will aid you in different stages of the process.

                   

Best Price:

                   

Realtors have their fingers on the pulse of the current real estate market, and will know what comparable properties in your area are selling for. They have the resources and knowledge to establish the best asking price and to attract the highest selling price. With access to their company’s professional marketing resources and connections, they will ensure potential buyers are immediately made aware of your home and market the property to sell as quickly as possible and for the most money.

                   

“Showcasing” Experience:

                   

Your Realtor will know the importance of a property’s first impression. S/he will have experienced first-hand, for example, the impact a property’s “drive-up appeal” has on the rest of a potential Buyer’s experience of your home. Your Realtor will be able to offer you tips and information on how to get your home in the best selling shape possible, in order to sell your property quickly and for top dollar.

                   

Access to Qualified Buyers:

                   

Realtors save time and effort by dealing only with qualified buyers. They have access to a pool of pre-screened and pre-qualified buyers who are serious about buying a home in your neighbourhood. Realtors work hard to develop this base of qualified buyers which will become an invaluable resource for you.

                   

Negotiation Skills:

                   

Realtors serve many functions, but perhaps the most important is their role as primary negotiator on your behalf. Your Realtor realizes your goal is to sell your home as quickly as possible, and for the most money possible, and will work closely with you during the negotiation process to facilitate this goal. Realtors bring to the process the knowledge and skills to draw up legally binding contracts, to assist in negotiating offers and counter- offers, and to offer counsel and perspective as you work toward your selling goals.

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Whether seeking solace, activity, schools, churches, or green space, every homebuyer looks for a different combination of attributes in a new community. Choosing a neighbourhood that suits your needs and wants is one of the most important decisions you’ll make in the home-buying process; your choice of environment will affect the way you experience your new home. This is a very personal decision, influenced by countless unique factors colouring your own lives, but you should always keep the following in mind:

 

1. If you’re considering buying a home in a community that is unfamiliar to you, get to know its lay-out, offerings, and ambiance. Take some time to walk or drive through the neighbourhood, both during the day and at night, familiarizing yourself with the sights, sounds, and smells.

 

2. What amenities does the neighbourhood have to offer? Is public transportation readily accessible? Are there schools, churches, parks, or grocery stores within reach? Consider visiting schools in the area if you have children.

 

3. What is the nature of the job market in the area? Keep in mind that if area employers are producing more jobs, you can expect property values to increase, especially if the jobs offered fall within a higher salary bracket.

 

4. Speak with the neighbours. Ask questions. They can offer you a wealth of information, from an inside perspective.

 

5. How will you be affected by a new commute to work? Drive the route between the new neighbourhood and your office during the appropriate times to gauge the volume of traffic you could expect to encounter, and the amount of time you’d need to put aside for daily travel.

 

6. Contact local land-use and zoning officials to determine existing development plans or potential for development in the area. A strong agenda for neighbourhood planning and local zoning will increase the value and draw of a neighbourhood. Keep in mind that any large, tree-covered area may be a target for future development in popular communities.

 

7. Determine whether financial resources have been put in place to support infrastructure projects in the area. These construction projects might include building, replacing, or improving anything from schools to roads, and are usually part of a city or town’s long-term plan. While disruptive, construction could also be a benefit to your experience of a community, influencing the long-term value of the area.

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