Steven Keefe, Broker/Owner
Coldwell Banker Sky Ridge Realty 
Arrowhead Home Loans, Inc.
www.mountainmoves.com
steve@mountainupdate.com
909.336.2131
Home prices
are always negotiable - especially in a Buyer's Market. A better question
is "what price reflects the present value of this property?" Finding
the answer to this question is often helpful when buyers are trying to
determine what price to offer.
The list
price or asking price is the seller's view of what the property is worth.
Prospective buyers have their own views. A deal is made when the buyer
and seller come together at an agreeable price.
In most cases, the parties “negotiate” until they come to terms.
What
determines value? The value of a property depends on your perspective. To a homeowner
who views the property as his or her "home," included in the value
may be intangibles such as memories, neighbors, time and money spent on
improvements. To a prospective buyer in most cases, the property is valued
by its potential.
To determine
the "right" sales price, whether you are a home seller or buyer,
value must always be considered in the context of the neighborhood, other homes
for sale, and general market conditions. The assistance of an experienced and
dedicated Realtor can help you gather the information you need to establish
fair market value, saving you valuable time and money.
Here are some
of the factors that contribute to the sales price of a house:
What
is the seller’s situation?
Real Estate
professionals agree that in most markets they are putting three types of
transactions together. First, is the
standard sale where the seller has sufficient equity in the transaction to sell
the property and pay off any liens. Second
is the short sale. In a short sale, the
seller does not have sufficient equity in the property to cover all the
liens. In this type of transaction, the
seller can approve a sale, but the shortfall needs to be approved by any lien
holders before the sale ca be completed.
The third type of transaction is the bank owned, or REO sale. In this instance, a homeowner has lost the
property due to default and it is currently owned by a bank.
The
Seller's Motivation:
There three kinds of
sellers. Seller 1 has to sell his
home. In this instance, there is some
compelling reason. Either they have to
sell it or they are going to lose it, or there is some other compelling reason…
job transfer etc. Seller 2 would like to
sell his home, but doesn’t have to.
Seller 3 would sell his home if he got his number. Seller 1 is most motivated while seller 3 is
least motivated to make a sale.
The
Buyers Motivation:
Does the
buyer have to have it? In most cases
unless the property has some unique qualities or amenities, most buyers don’t
have to have some thing.
Comparable
Properties:
Realtors
utilize comparable properties to establish value, knowing that buyers will be
comparing what is available and what has sold when choosing a property and the
amount to offer. Size, location age and
condition are all factors that are compared to evaluate a property against
similar properties.
The
Community:
Value is
certainly affected by the surrounding community. A property can be elevated, or negatively
affected by the surrounding properties or community. In our market, properties located in the
woods which have lake rights are of a higher value than those outside the
boundary. There are many factors that must
be considered when evaluating and factoring the community into value. Summary: When emotion
and circumstances are removed from the process, the market value of a property
can objectively be arrived at by comparing similar properties that are available
and that have sold. It is only when the
emotion and circumstances that are added to the equation that the difficulty
occurs. Very little
emotion, and circumstances whereby banks or sellers in trouble want to unload
the property is contributing to many REO and Short Sale transactions going
together at below fair market value. A
fewer number of “normal” sales are going together where sellers are
understanding that much of the emotional attachment they have is less
significant to buyers in the current market.
If you are
ready to buy or sell in mountain communities, we would be happy to assist you
with any of your real estate related needs.
Please contact our office at 909.336.2131, visit us at www.mountainmoves.com, or send us an
email at steve@cbskyridge.com
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