Home values or what your home is worth, is a big part of the equation when deciding to sell your property or not. Realtors generally use what is called a CMA, Comparative Market Analysis. It’s similar in some ways to getting an appraisal done, but we are not licensed as appraisers and there are no set guidelines for us to follow. Basically, it is just an opinion of value, and like all opinions, two people can have some very different ideas. You had better be involved and informed when you have a CMA done to help determine the value of your property. There are realtors out there who, in my opinion, don't look closely enough at the homes they are using for comparable, and therefore don't end up adjusting the selling or listing price accordingly.
Example, many homes often report selling at or above the asking (list) price. Any home that has sold at or above the list price in today’s market most likely gave concessions (paid the buyers closing cost, gave money for new carpet, roof, etcetera.) A realtor doing a CMA and using a home that sold for more than the asking price has an obligation to research that transaction and find out the details of what transpired and adjust the CMA accordingly.
Here is another reason you can get two very different opinions of values on your home. Realtors sometimes adjust higher or lower for certain items. If you have a detached 2-car garage, and the comparable sold property the realtor is using to price your home doesn't have a garage, did the real estate agent add $10,000 to the value of your home or did they add $20,000. Big difference for the garage that you know cost you $8,500 to build.
Change it a little, and let’s say the comparable sold property does have a 2-car garage, but it is attached to the home with a small mudroom between the garage. Did the realtor adjust at all or just say, you both have 2-car garages so they are similar. The average buyer is willing to pay $7,500 to $10,000 more for an attached garage over a detached garage. Remember, that's just my own opinion. Through the process it is pretty easy to get a very inflated price on your home. So get involved in the process and ask questions.
This is very important! You need to know the realistic sale price of your home and price your home accordingly, taking into consideration the competition for similar style homes in your area. Work with your realtor and if you decide to sell, list your property at the price that will accomplish your goals in a time frame that is suitable to your needs.
Matthew Trudel is the owner of Five Star Realty, he has over 16 years of experience and is ready to assist you in all your real estate needs. He can be reached at columnist@TheWindhamEagle.com.