Tips to Determine True Value of Your Home – Home Valuation Tips
If you are selling your home in Newmarket or anywhere else for that matter, your first challenge will be to come up with the right asking price. Keen to know how much your home is worth, you will probably check out online calculators and call up many real estate agents, asking each one of them for free consultation on the price. The irony is they may come up with completely different estimates. As a result, you will become more confused.
What most homeowners don’t realize is that determining a home’s value is a long, sometimes very complex process. Various factors related to the property, the condition of the real estate market and the location are taken into consideration in order to put a price tag on a home. You or a real estate agent can’t just look at the property and hope to know its price.
It is extremely important to price your home right from the very beginning. If you overprice, your home will end up staying on the block for weeks, even months – resulting in the loss of interest from prospective buyers.
Competitive Market Analysis (CMA)
A comparative market analysis is a study of homes of similar size, condition and location.
Following data can be included in the CMA:
- Homes sold in the past 3-4 months in the same neighborhood
- Properties of similar size, location and condition currently listed for sale (active listings)
- Expired and withdrawn listings
- Age of the comparable properties
- Influence of modern appliances and desirable features on the price of comparable homes
- Proximity of your home to major amenities such as parks or school in the same neighborhood
- Views offered by the property
- Median home prices
- Number of days on the market
- Average square foot cost
Each of these factors can influence your asking price. An agent, who is experienced in representing buyers and sellers in your neighborhood, can easily collect these details and determine what influence they will have on the asking price.
Condition of Your Real Estate Market
It is an important factor to consider when determining your home’s value. If you are selling in a buyer’s market (where lots of homes are up for sell, but few buyers), you might want to allow some wiggle room for negotiation. If your CMA estimated the asking price of comparable homes to be $300,000, you might list the property for $298,000, settling for $295,000.
On the other hand, you can price your home at the higher end of the value range; even add possible appreciation in home values in your area to the price if you are selling in a seller’s market. Find out when the last comparable home was sold and what has been the rate of appreciation in values until you listed your home in Newmarket.
Keep in mind even after you have priced your home in Newmarket, a lot will depend on how you or your real estate agent handles negotiations with the buyers. Always keep a contingency plan, in case the property doesn’t go for the desired price and change your strategy accordingly.