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Comparing Apples To Pears

Reblogger Doug Bullwinkel
Mortgage and Lending with E Mortgage Capital, Inc. NMLS 1416824 CA NMLS #281609

This is a great article to remind us how important it is to use a good Realtor when buying or selling your home.  Having accurate information, along with the expertise to analyze it is critical when determining the correct value of a home. 

Original content by Karen Fiddler, Broker/Owner BRE# 01494165

 

I know...typically this would be apples and oranges, but the only graphic I could find has a pear instead. At first I thought, "this doesn't make any sense"! Then I started to think about it, and actually it's a pretty good analogy.

Every buyer wants to know if the home they are considering is a good value. Of course they do....but how to tell these days?

I hear all the time from these self-comping (is that even a word) buyers; they are using "comps" from Zillow, they are checking "solds" from Trulia, they are seeing "current" price-per-square-footage from Redfin. Assuming for the moment that the data is even current, it's still not a professional comparable analysis.

In the cities I service, the square footage figure is not a realistic way to determine value. So few buyers understand this. An appraisal is not based just on taking a recent sale of an 1800 square foot home and using it to price a 3000 square foot home in a different housing tract. It's more specific than this.

And it is like comparing an apple to a pear. Oranges would be too understandable! Everyone understands why an orange is not an apple. They are very different fruits....one is a citrus and one has flesh, they look differently, taste differently and behave differently.

Pears and apples are similar in so many ways...just as our houses can appear. But location, amenities, perception all play into the value of the homes. A gated community home in one area of Mission Viejo, for instance, has quite a difference square footage from another only 1/2 mile away. Understanding the differences...especially if they LOOK the same online. They might! This is where the experience of a local Mission Viejo Real Estate Agent is critical. Your agent (me....as an example) can put the raw data into context.

We NEVER want to over pay for a home...absolutely never...but comparative analysis is complicated. Even in a good market, understanding the factors which differentiate one home from another is important. Now? With short sales, bank owned homes and equity sales...it's absolutely vital that a professional Real Estate Agent aids in gathering the facts on the property value.

 

 

 Karen Fiddler
Broker/Associate
The Fiddler Realty Team/eVantage Real Estate
Lic # 01494165

www.SearchForOrangeCountyHomes.com

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Show All Comments Sort:
Tim Lorenz
TIM LORENZ - Elite Home Sales Team - Mission Viejo, CA
949 874-2247

I couldn't agree more.  The difficulty in our area is the low sales and listings.  It causes the appraisers to look at properties out of the immediate area.

Feb 26, 2012 01:46 PM
Ronald DiLalla
Century 21 Discovery DRE 01813824 - Anaheim, CA
No. Orange Cty Real Estate

Hi Doug,  lots of great information in Karen's blog...thanks for sharing it with us in ActiveRain Land.

Feb 26, 2012 02:16 PM
John McCormack, CRS
Albuquerque Homes Realty - Albuquerque, NM
Honesty, Integrity, Results, Experienced. HIRE Me!

Doug - A really good choice of re-post my friend.  Karen shares great information here and she's right getting the correct price is complicated.  Have a great week my friend.

Feb 26, 2012 09:52 PM
Joni Bailey
101 Main St. Realty - Huntsville, TX
Your Huntsville / Lake Livingston Area REALTOR®
In rural areas this can be very difficult. If there are NO comps. I ask them to get an appraIsal and refund the cost of the appraisal at closing. I do not make up numbers. Tell the truth -- and the best thing when no comps are not available is to have it professionally appraised. This is also good when they want to list at an outrageous price.
Feb 26, 2012 10:12 PM
Tom Arstingstall, General Contractor, Dry Rot, Water Damage Sacramento, El Dorado County - (916) 765-5366
Dry Rot and Water Damage www.tromlerconstruction.com Mobile - 916-765-5366 - Placerville, CA
General Contractor, Dry Rot and Water Damage

It is important that we get good comps Doug. Thanks for the reblog.

Feb 26, 2012 11:10 PM
Joy Daniels
Joy Daniels Real Estate Group, Ltd. - Harrisburg, PA

AMEN!  What a great analogy.  Thank you for sharing your thoughts.  You are so right - buyers and sellers that only experience real estate a few times in thier lives needs to connect with a professional realtor that has years and years of constant experience in real estate.

Feb 27, 2012 09:44 PM
Karen Hawkins, MBA - Langley & Surrey, BC
Royal Pro Real Estate Network - Langley, BC

Great choice for a re-blog, Doug - and the analogy extends to our financial professionals as well. Everyone should understand the substantial benefits that are gained by using the services of a mortgage expert. I'm sure the Vitek Mortgage Group could help out folks considering buying or refinancing...!

Mar 01, 2012 12:51 AM
Linda Holloway
Keller Williams Realty Tampa Central - Tampa, FL
REALTOR®, Your Next Home in Tampa Bay Starts Here!

Hi Doug, This is a great re-blog.  I missed Karen's post.  She uses an excellent analogy to make a point.  A real estate agent is still needed to interpret the data when buyers are comparing homes.  Thanks for posting!

Mar 01, 2012 10:23 PM
Karen Fiddler, Broker/Owner
Karen Parsons-Fiddler, Broker 949-510-2395 - Mission Viejo, CA
Orange County & Lake Arrowhead, CA (949)510-2395

Hi Doug, thanks so much for the reblog, and nice introduction. Hope you have a great weekend, just wanted to stop by and say "hi".

Mar 02, 2012 04:27 AM
John McCormack, CRS
Albuquerque Homes Realty - Albuquerque, NM
Honesty, Integrity, Results, Experienced. HIRE Me!

Doug - My man thanks for stopping by my post tonight.  Good to see you and look forward to seeing more of you in the Rain!

Mar 06, 2012 03:39 PM
C. Lloyd McKenzie
Living Albuquerque - Albuquerque, NM
Living Albuquerque

Good Evening Doug:

An excellent post to put back up.  I think Karen has hit the nail on the head with this one.

Mar 10, 2012 03:48 PM