The number one question you likely have is...How much is my home worth?
That's a powerful number, and it carries tremendous emotional value with it. Joy, if it's what you think it should be, or better; sorrow and anger if it is less.
Unfortunately in this market the #1 seller question is not always easy to answer, and in more cases than not, the correct answer is not the news you want or hope to hear.
Real estate is NOT just about statistics and numbers, although they are a key component - loan amount, interest rate, personal financials, and closing costs certainly are numbers driven. But there is a large component of emotion when selling a home, just as there is for the buyers who are purchasing. Making a decision on how much to sell your home for based on emotion rather than the statistics won't work, at least not in a market where low ball offers and requests for concessions are commonplace.
Needless to say, whether you are a numbers person or not, knowing what YOUR home is really worth is essential, and having the statistics to support that value, or refute what YOU think it's worth, are critical. The price your neighbor got for her home 1 year ago won't cut it. Nor will your own requirement that you need $xxx in order to buy the move-up home you want.
A knowledgeable REALTOR will provide you with a variety of statistics that will help determine the price your home is likely to sell at. Certainly you don't want to under-price it, but too high a list price is the kiss of death - people won't come to look at it and they certainly won't be making offers. So your agent, or one you are considering hiring, should say "Let me show you what I mean" and share a bunch of data to provide you with a full picture of the local housing market.
We are all aware of the statistics and trends that get reported in the media, but perhaps you do not realize that, as a source of data about the housing market, the media is woefully inept. Reporting general trends on a county or a region says little or nothing about what is going on in the local market, which is where you should be concerned. But there is a good chance that there are some negative things happening in your market, and you need to know what they are AND how they impact you and your home sale.
As a seller, here are just a few of the things you should know:
- What is selling on the market (price range, price per SF, days on market [current contract and prior, if any], average price, # and amount of price reductions, average sales price/list price ratio) and what is not. The more details the better, in particular with respect to your home's price range. In some communities homes under $300,000 are selling well but pricier homes are not. And if prices are declining you should only look at the last 3 months of sales - appraisers will.
- What is the competition? (I recommend actually seeing these homes to compare to yours - it might be a real eye opener). And what homes have been listed but rejected by the market (the expireds)?
- Current inventory, especially in your price range (say $400,000 to $500,000). How many months are inventory is there as compared to the rate of sales? Is there a decent demand for your market segment or not? Is it a buyer's market or not (most areas these days are).
- Statistics regarding the number of short sales, pre-foreclosures and REOs (bank owned properties), and prices of homes sold, among other information. These homes (if sold) can impact the value of your home, as well as the appraisal done by the buyer whose offer you accept, in a negative way. Plus having a number of them in your immediate area can have negative impact for buyers, even if you home is not on of them, because of concerns about decline, etc. And they expect that all the homes will therefore be priced lower.
Not only do you need to know the statistics, but you should find out what these statistics mean for you. What direction are the trends heading, and what are the implications? Will it make your home easier to sell or not, and what are the chances of it selling in the short (will it be one of the 10% that sell?).
A final word - the possibility exists that, depending on your equity and loan balance, and the market value of your home, the BEST decision may be to not sell right now, unless you have no choice due to hardship (job loss, divorce, ARM adjustment) or relocation.
If you would like more customized information about the Carlsbad real estate market and your home in particular, or other communities nearby, or want to learn more about the things you need to know about your home's value, please feel free to get in touch with me. You can read the recent Carlsbad market report, with a link to prior reports, for more information.
Other sample recent market reports:
Cardiff Real Estate February 2009 Market Report
Solana Beach Real Estate - Solana Beach Market Report for February 2009
Encinitas Real Estate - Encinitas Market Report for February 2009
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If I can provide more information about Carlsbad and surrounding areas, or the housing market in general, or otherwise assist you in your homes search, please contact me by phone or text at (760) 840-1360 or email me at JDowler@remax.net.
All content copyright © 2009 Jeff Dowler Carlsbad Homes and Real Estate Tidbits
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