When someone gets ready to sell their home, there is always the concern over how to price it…what’s it’s value?…how much is it worth?…what will a buyer think it’s fair market value is? These questions each have very different answers.
The value of a home to sentimental owners remembering raising their children there or to an owner who has put lots of money into “fixing it up” and wants all of that and more back rarely equates to the value the consumer will be willing to pay. Recently, even the appraisal value, which is the purported “market value”, may not be what buyers are willing to pay. So, using the appraisal value as a benchmark and pricing the home at or a bit below that isn’t a sure thing either.
As Realtors®, we try to use as many tools as we have available to us to determine the market value of a home. Despite our best efforts, the current housing market is very difficult to read. What a buyer “values” can be different based on the features of the home, based on the schools that their children will go to, based neighborhoods and their amenities, even based on whether or not there are trees (and whether or not the Buyer is afraid of a tree landing on their roof in a storm).
There’s an old joke that everyone thinks their house is worth a lot more when it is being appraised and a lot less when the tax assessor is valuing it. A similar dichotomy exists when someone is the Seller and when that same person is the Buyer. As the Seller, they want the most they can get for their home and price it high. While as the Buyer, they want the best bargain they can get on their new home and offer a low price to get “a deal.”
It all boils down to this—your home is only worth as much as someone else is willing to pay for it. Even if your neighbor’s house, which is not as nearly as nice as yours, recently sold for a certain price, that doesn’t guarantee that if you list your home—even a few months later—there will be a buyer willing to pay a higher price for your home.
So, the moral of this story is be flexible. If you list your home and it’s in nice condition, if it doesn’t get buyer showings…then it is most likely too high for the market. Sometimes, when inventory is plenty, even a reasonable price might not get an offer…despite having lots of showings.
All is not dire…but we need to remember that everything in Real Estate is local…and sometimes down to neighborhoods. Right now, in our area we are seeing lots of homes for sale in the mid-range price and they are taking longer to sell. Let’s all hope that Spring brings more than just flowers…let’s hope it brings BUYERS!