Real Estate Market Value - What's my Home Worth?

by Laura Jacobus

With so many homes on the market, how do you get yours to stand out and get sold?

The reality of today's real estate market is tough for most homeowners to accept. Living in the present means understanding the price is not what the seller wants to believe his home is worth, but what the buyer will actually pay. We call it "Market Value".

In the spike of the 2005 real estate market, many homeowners had their properties refinanced or had a realtor do a comparative market study (CMA). The lenders were eager to give out loans and the property prices were climbing. The crash of reality is difficult for many homeowners to face. They had now overextend credit and the value of their home declined.

Pricing your home accordingly means being in step with the current market value, not expecting your overinflated CMA to be in line with current conditions. The fact is the higher you price your property, the fewer people who will come see it. Buyers actually run searches based on their comfort range of monthly payments. The range is usually within $25,000 increments. If you overprice your home, you miss a potential showing simply due to being outside of the buyers range of sight.

Have your listing agent review sale prices in your area, and pay attention to homes that did not sell. Take notice of the reason. Most homeowners will overprice their home, hoping the buyer will come along who will pay top dollar, only to drop their asking price a few months later, and miss hundreds of virtual showings.

Understanding the fair price of your home, means understanding the appraisal. The money spent on certain upgrades do not necessarily equal higher asking price. Outdoor upgrade have virtually no impact on appraisal. Although your home has better "curb appeal" a bank appraiser doesn't really care about your zen garden or waterfall spa. Emotional attachment on the sellers side to these items are not important to a buyer or appraiser.

Internet savvy buyers are looking for best value for their dollar, not
making up for your idea of of custom upgrades and fancy wallpaper. More showings equal higher percentage of possible offers on your home.

The bottom line is, set a higher price and play the waiting game, or
set a realistic price and prepare to move!