My real estate company sells homes in Venice, Florida, and we often encounter widely varying opinions on prices for various properties. Some homebuyers do NOT appreciate the process of establishing a home price range and can use help with how a price range is determined. And the online home search sites rarely get it right, being off by as much as 30%.
Establishing a valid price range is crucial. This can be done by looking at data. Similar new listings around the property, similar pending sales around the property and recent similar sold homes around the property. The key is SIMILAR…
Here are several additional factors to consider when pricing or even comparing one property to another. Keep in mind that pricing a home for sale should be done on a micro level and sellers must get this right to generate the proper level of activity to generate offers in a reasonable time frame (within first 2-4 weeks). You should weigh each of these in terms of importance to you if you are buying and the costs associated for a seller to provide these when comparing to other homes.
Neighborhood/Location – How does this home compare to others in the neighborhood and on the street. Is waterfront involved or a gated, Deed Restricted Community with a HOA? Is the overall neighborhood well maintained? Does it have a good reputation for location, schools, commuting? Is this home better or worse in terms of overall condition? Is it larger or smaller than other average homes around it? Is it well placed within the neighborhood? Are there any known or anticipated changes to the neighborhood or area that may impact quality of life? Is the annual cost of ownership less or more than similar communities – are amenities similar?
Date Of Sale – When was the home last sold? If considerable time has elapsed it may be in need of updating and structural improvements. If recent, it may have been renovated to sell or the current owners may be in financial trouble and need to sell.
Age/Condition – When was the house built? Has it been updated to existing building codes? Was the builder reputable? Items to consider first are foundation structure, supports (no dangerous cracks or water signs), heating/cooling, plumbing/septic systems, water supply, electric service, roof condition, windows and doors. Hurricane updates? What will repairs cost? Is the condition reflected in the price?
Acreage/Privacy – How much land is included with the property. Is it wetlands, in a flood zone or useable? How does this measure up to other similar homes and is privacy a factor or is the home still close to other homes due to placement on the lot? Does it back up to conservation land or green areas? Is it at the end of a cul-de-sac? Is landscaping substantial and provide privacy?
Square Footage – Is the interior of the house adequate for you and your family? How much room and how many rooms do you require? Does the listing provide a total living area square footage – minus areas not finished? Only total living space should be included in square footage. Florida uses heated/cooled space. How does this compare to other homes in the neighborhood or homes you are considering? Is the cost per square foot (home price divided by sq.ft) close to other similar homes?
Amenities – What are the details of the house that add up to a home? The quality of the building. Finishes in terms of built-ins, woodwork, hardwood flooring, cabinets, specialty glass and windows/doors. How does landscaping affect the curb appeal and livability of the home? Does it have a pool, gardens, and walkways? What special differences in the home separate this home from others? What would it cost to provide these? Is it missing something it should have for the price?
Views – Is there a water view, a view to landscaped green areas, a view to the city? Any view that lends a unique value and perspective to a property will affect its price. Depending on the area, it is more than subjective.
Other Structures – How many outbuildings on the property. What is their use and condition? What purpose do they serve and can they be put to other uses to expand the overall value of the property.
Other – Some properties just have a presence. It’s a feeling one gets when seeing a property and walking through it. Intuition is your best sense. When you experience this at a property you should listen. Other considerations may be historical significance, celebrity ownership, style of the house and materials used.
All the above are used to arrive at a price range. And I’ve probably overlooked a few trying for brevity. Yes recent sales around the property are important but again consider all of these on a micro level and price the home competitively based on its unique value. Your REALTOR® should be certain to detail what those are and be able to talk to these in relation to the competition.
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