Happy 4th of July
July 3rd, 2009 categories: Entertainment
Thanks to those serving to keep our country free and able to celebrate our independence on the 4th of July.
Be safe and have a wonderful weekend.
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What is the Right List Price in Real Estate.
June 30th, 2009 categories: Pricing, Real Estate Sales
A few days ago, (in part 1 of 2 articles) I discussed “How to Value Real Estate“. Today (part 2 of 2) is focused on how to accurately price your property. So if you are thinking of selling in West Chester, Fairfield or Cincinnati-these basics apply.
Most (but not all sellers) sit down at a listing appointment waiting to hear the “suggested list price” from their realtor or from whoever is helping with sale. Realtors will go through a “macro” view- the area in general and work their way down to a “micro” view of your specific subdivision or complex. The report will show active listings, pending sales and closed sales of properties that are comparable to yours. The closed sales should be recent- no more that 6 months old (preferably 90 days or less) and should reflect data from the multiple listing service as well as a check of online county records- catching any sales not handled through the MLS.
Because we are in a “different market” sellers also need to see average sales prices for the last 8 years for comparable properties. The decline (or increase) is the rate of depreciation (or appreciation) that has occurred should be taken into effect when considering pricing the property for the current market.
Seller’s View:
Mr. & Mrs. Seller paid $202,00 in 2004 for the 4 bedroom, 2.5 bath, 2 story in Fairfield. Since the purchase they’ve redone the landscaping, resurfaced the deck, new carpet and new paint throughout. Figuring in appreciation (2% per year) raises the price to (roughly) $220,815 + carpet $7,000 + paint $1800 + deck $2100 + landscaping $2300 = $234,014. Then most sellers add another 10% to cover “stuff and commission which brings the list price up to $257,415.
But wait, the last 8 years of sales in Fairfield instead of a 2% per year value increase-since 2004 (t0 2008) there was an overall 8.1% decrease (depreciation) in average sold prices.
So Mr. & Mrs Seller need to rethink their math, deduct for depreciation and only look at true remodeling investments as adding some value. The deck, paint, carpet and landscaping may improve curb appeal and add sparkle to inside-but sellers cannot expect to recoup the money spent taking care of their property. In Fairfield there are currently 32 single family (4 bedrooms, 2.5 bathrooms, 2 story) active listings in the Multiple Listing Service of Cincinnati. 14 have sold/closed in the last 6 months. The absorption rate (# active listings/ avg # sold each month) equates to an almost 14 month supply of inventory. Sellers need to ask themselves where do they want to position themselves to attract offers from the next buyers coming into the marketplace.
Buyer’s View:
To Meri and Beri Buyer the question becomes…”What is the difference between this 4 bedroom and that 4 bedroom and is it worth the price difference?
It’s a fairly simple formulae that becomes complicated when emotions are involved. Trouble understanding the right listing price versus your listing price- step back and put your “buyer” hat on.
Still struggling to come up with the value- call or email.
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How to Value Real Estate
June 29th, 2009 categories: Real Estate Buying, Real Estate Selling
(part 1 0f 2)
Are there 3 different ways to value real estate?
When I started in the business (20+ years ago) there was a funny comic depicting how the seller, buyer and appraiser looked at properties.
How the seller valued the property…
What the buyer saw…
…and finally how the appraiser valued the property.
At the time 75%+ of the financing was FHA and appraisers were sticklers about condition of the property. In effect, every sale had 2 inspections- one by the home inspector and then another one by the appraiser. We (seller, buyer and agents) worked through the issues and deals closed.
Value of real estate is in the eyes of the buyer.
Today, we are dealing with a “different” real estate market, however establishing a price on a property is still reflective of the 20+ year comic….seller’s value, buyer’s value and the mortgage appraisal. Lots of sellers utilize purchase price + appreciation + investment in property = list price. Buyers are often more sophisticated and arrive at value by comparison shopping….how does this 4 bedroom, 2.5 bath, 2 story differ from the one down the block? Finally the appraiser is the least subjective following fairly stringent guidelines when appraising a property.
(stay tuned for part 2 of 2 )
How should seller’s come up with a “List Price” for their property?
Related Article: What Do Buyer’s Really Know
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Blasting Through Hyde Park
June 28th, 2009 categories: Entertainment
Hyde Park Blast was awesome. Great weather, lots of bikers- just a great place to be on Saturday.
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Is Cincinnati Rated a Great City to Live?
June 25th, 2009 categories: Cincinnati, Ohio, Real Estate News
Sadly-the answer is no!
Recently U.S. News & World Report magazine looked at areas with strong economies, low living costs, and plenty of fun things to do to identify this year’s best places to live. Supposedly the editors reviewed more than 2,000 locations nationwide, considering such factors as sales taxes, housing prices, average number of children per square mile, proximity to healthcare, and the availability of educational institutions.
According to the article the 10 cities honored as Best Places to Live are (listed alphabetically):
1. Albuquerque, N.M.
2. Auburn, Ala.
3. Austin, Texas
4. Boise, Idaho
5. Durham, N.C.
6. La Crosse, Wis.
7. Loveland, Colo.
8. San Luis Obispo, Calif.
9. St. Augustine, Fla.
10. Upper St. Clair, Pa.
Source: U.S. News & World Report Article
If you are curious about cities in Ohio (or any other state) Link to State search on US News and World Report for detailed information.
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