Determining Your Home's Value
From replacing a rusted out bathroom sink to laying laminate flooring, Americans are hooked on the DIY/HGTV craze. Some things, however, are better left to professionals. Establishing your home's current market value before putting it on the selling block or pursuing a refinance is one of those things.
To determine its value, appraisers and real estate agents will compare your home (the "subject property") to those that have recently sold in the area (known as "comps"). They will adjust the comps' prices up or down, according to how similar each home is to yours.
Read on to learn how a home qualifies as a comp for yours.
The market value of a home is, simply, what a knowledgeable and willing buyer will pay it. This figure is reflected in the sales price of recently sold homes.
Appraisers and real estate agents use the local Multiple Listing Service (MLS) database in their research, to look for homes that have sold within the past six months. Only real estate licensees that pay an MLS membership fee will have access to this database, so a DIY consumer will find it challenging to locate a full and accurate list of sold properties.
Since location is one of the principal indicators of property value, appraisers and real estate agents seek sold homes that are in close proximity to the subject property. Some lenders give strict location requirements to appraisers, for example a comp in an urban or suburban area must be no more than one mile away, and rural comps no more than five miles away.
Real estate agents, on the other hand, have a little more leeway and will typically begin their research close to the subject property and then widen the area until they've found three comparable properties that have sold in the past six months.
Neighborhood characteristics that influence a home's value include:
Proximity to shopping
Traffic, airport or other noise
The quality of the school district
Number of distressed properties in the neighborhood
Declining values or oversupply of homes in the area
Price Per Square Foot
You may see sold homes or homes for sale that list the price per square foot in addition to the price of the home. This figure takes into account only the home's square footage and nothing else. Because it fails to account for the diverse aspects and special features of the house,
it isn't an accurate reflection of value.
That said, with all other aspects being equal, a larger home will most likely sell for more than a smaller home.
Deferred maintenance will drag down the value of a home. Deferred maintenance includes all of the items you have been meaning to fix, but never got around to.
Loose or missing hand rails
Dirty or damaged carpets or other flooring
Since it is unlikely that your agent or an appraiser will find a home that's identical to yours, he or she will need to make adjustments to the sold prices of the comps to account for the
If the comparable home is inferior to the subject property, value is added to bring it up to par. Conversely, if the comparable is superior to the subject, value is removed.
Here's an example of how this works:
The subject property has three bedrooms, two bathrooms and a pool. The comparable property, located three blocks from the subject, sold three weeks ago for $387,500.
The comparable property has three bedrooms and two and a half bathrooms, but it doesn't have a pool.
The appraiser or agent will deduct value from the comparable for the lack of a pool and add value for the extra half bathroom. The amount to deduct or add depends on the value the local market places on items such as a pool or a half bathroom.
The adjusted price range of the comp will reflect the current market value of the subject property.
Determining a home's market value isn't rocket science, but it does require current, accurate information and some experience with the process. The Swain Team will not only determine the current market value, but will also give you tips on how to get top dollar for the home.
Contact us at (215) 757-7257 or TheSwainTeam@gmail.com and we will setup an appointment to sit down and go over your home's value in today's market.
Remember, we are always here to help!
Determining Your Home's Value
At our home selling seminar’s we educate attendees on how important it is to maximize their budget. Basically, if you want to sell for top dollar what upgrades and repairs can you make that will yield you the highest return.
There is one item that doesn’t make the list and that is neutral paint since it is not a “remodeling job.” However, when you repaint your home so that it is all neutral and fresh not only will you increase your profit but the home should sell much faster too. We do have colors we recommend that look good in every light. Just give us a call, we are happy to help!
If you are interested in selling in the next few years, come out to one of our upcoming home selling seminars. To maximize your budget you need to plan in advance. We also offer individual free 30 min Room by Room Reviews where we come out to your home and walk thru it with you and create a plan. We will offer tips of what should be done to the home to sell for the most money. We don’t want to see you spend unnecessary time & money on a
project that won’t offer you any return.
Our next seminar is April 2nd at 9:30am at the Home Suites By Hilton in Newtown.
If you are interested in a Free 30 minute Room by Room Review, give us a call. We are happy to help. (215) 757-7257 or email: TheSwainTeam@gmail.com
Do you know of someone preparing to sell their home? Maybe they want to sell in a few months or years. If so, share with them what a Room by Room Review is and how it can drastically help them. We have seen so many clients spend money on unnecessary items that offer no return on investment. That is why a Room by Room Review in advance is so crucial. It allows the seller to maximize their budget and get the best return on investment for the money they put into the home to sell.
A Room by Room Review is a free 30 minute appointment to evaluate the current
sale-ability of your home. A member of the Swain Team will come out to your home and do a walk thru of each interior room as well as the exterior of your home.
At your Room-by-Room Review we will give staging tips, paint color, and what to do with clutter...and so on. It is like having a real estate doctor come out to your home. The Room-by-Room Review helps a home owner prioritize what to do to prepare their home for their buyer! Clients often feel more organized and prepared because they have a plan of action.
In each area of the home we will discuss how best to stage/prepare the room for the market. This is a discovery process where you will learn the areas in your home that would showcase better to buyers with some enhancements.
We will make suggestions that will help set your home apart from the competition. Stay close and keep a pen handy to write down every suggestion.
Remember, we can look past clutter and give you a prioritized list of what to focus on.
Get top dollar for your home and have it shine when it is time to sell.
Want to schedule a Free 30 minute Room by Room Contact us at (215) 757-7257 or TheSwainTeam@gmail.com. Remember, you have an attorney, doctor and financial planner in your circle, get an expert Realtor who is there as well.