Housing Sales Have Picked Up In The Past Few Weeks ... Where Are The Prices?

Sales Across Northern Nevada Have Picked Up ... Where Are The Prices?  

Pricing your home is still a very critical part of the sales process.  With the increase in market activity we've seen the pricing freefall slow, but it hasn't stopped yet.  Statistically, the market is still declining at about 1.5% per month.  It is important to price your home right not only to get a Buyer to look at and buy it, but in order to get it to appraise right. 

We have experienced, heard about and read about many appraisal problems lately regarding value.  Often these are caused by the new Home Valuation Code of Conduct (HVCC) regulations that became effective on May 1^st, but not all of the problems can be attributed to out of area appraisers.  Sometimes we just have to fact the fact that the home won't appraise for what a Buyer is willing to pay for it. 

How can that be?  Historically, the value of a home was deemed what a willing Buyer would pay and a willing Seller would sell for.  If that is the case, how can an appraisal come in 5-10% below what a willing Buyer would pay and say that is the value today?  If the numbers indicate the value is the lesser number, and often they do, then one must ask why a Buyer would pay more in this market.  The answer is not that complex.  

If a Buyer is buying a home for little or nothing down, and their payments are affordable because of the low interest rates and prices, then they are happy to make the deal.  They aren't looking for the "steal of a deal", they want to buy their home, get their $8,000 First Time Home Buyer's credit, and move in.  They aren't so keen on negotiating to the last dime.  

The lender, on the other hand, is taking the risk in making the loan.  The appraiser is charged with assessing the value of the home from an objective, third party basis so the lender can evaluate the risk.  If an appraisal comes in $10,000 below the sales price the lender's risk is greatly increased so they won't make the loan.  If it doesn't appraise you don't get the loan and you don't get the house, or your house doesn't get sold.  Appraisals are all important.  Yes, they can be challenged or reviewed, but that takes time and may not yield a significant result if there isn't a glaring deficiency in the first appraisal 

Our advice: Pricing is critical today.  The numbers have to tell the story or it won't matter how many offers you get on your property.  Unless somebody is paying cash (and cash Buyers don't usually overpay in today's market) they'll need to get a loan for which they'll need the property to properly appraise.  With the HVCC in place we are seeing some of the value factors that local appraisers and agents put emphasis on, i.e. - views, neighborhood amenities, etc., receiving little or no value.  Without that additional "value" homes are coming in low.  The opposite can also occur such as a reduction for being on a "busy" street not being identified by an out of area appraiser.  These are different times and we have to look at things differently to achieve success in our collective efforts - the sale of your home.   

Put your blinders and rose tinted glasses away when pricing - its time to get real if you want to get sold.  The good news ... you can sell in this market!  

When it comes to choosing professionals to assist you with your real estate needs... Experience is Priceless!  Lisa Wetzel & Jim Valentine, RE/MAX Realty Affiliates, 775-781-5472.  carsonvalleyland@hotmail.com, www.carsonvalleyland.com