Special offer
Paul Walker
Equity Fifty Five Realty, LLC - Scott AFB, IL
Scott AFB IL Area Realtor

I do more of a "market analysis" than a comparitive market analysis. I explain that no one knows the exact price a home will sell for unless it is "low enough". Also buyers are comparing asking price to asking price and looking the best bargain that meets their needs, along with only willing to pay what other similar homes have sold for recently. A seller may know that they are willing to "negoitiate" but buyers don't know that this seller will come down "x" and the other seller will not come down any, therefore you have to price to entice to get offers. There are many prices for a home. Wholesale, List price, Retail, (which is actually what buyers are willing to pay). There is no "scientific appraisal value"

The Market analysis simply is "how many homes are active in the price range" and "how many have sold in the last 3 months, last 6 months, and over the last year", and then how many are currently "sale pending".

This will give you how many homes are selling per month on average and how long it will take to sell the home in the current market. If only three homes in the price range is selling per month and there are 18 homes currently active on the market then you need a price better than 16 other homes for everything the home has to offer as compared to the other homes on the list (look at price, square footage, type of garage 2 car/3 car, basements, age, and updates)

The idea is to price it low enough to actually sell (within 30 days if possible) and to one of the first "3" (in this case) buyers that come through the door. It is not a matter of what the sellers owe (although you need to know if they can afford to sell, or be a short sale), but what will it actually take to sell the home in the marketplace - a fair market price) You can either lie or level with the sellers when it comes to price!

The longer the home is on the market, the less it will sell for in the end (especially net price and/or if the sellers have to move prior to selling) A vacant home will always sell for less than a home that is "staged" nicely. If it is cluttered then it may actually be better to be vacant. Buyers will make a "price decision" based on the curb appeal and inside condition. You have at least three prices there: poor appeal and cluttered inside (low), fair appeal outside and vacant (medium price) and great curb appeal and tidy/neat/clean inside (highest price possible)

Hope this helps a little!

P.S. there is just no one "price per square foot", yes you can get an average, but different floorplans, age of homes will play a big role in the price PSF. Also, you can run the same data above with as similar of "type of home, and age range" as possible too! It depends on the data in the MLS of how many "similar" homes have actually sold recently and the similar homes on the market. Sometimes at least in our area there isn't enough "market data" if you stick to similar, example ranches only with basements and three car garages built between 1990 to 1999 or so.

May 21, 2011 07:46 AM