Fort Worth Realty Values

What's the House Worth?

Market Value

Any house ultimately is worth, what someone will pay for it.  Everything else is an estimate of value. To determine a property's value, most people turn to either a professional appraisal or a "comparative market analysis". An appraisal is a certified appraiser's estimate of the value of a home at a certain point in time.  Appraisers consider square footage, lot size, quality, design, features and recent sales in the neighborhood. They also take into account your landscaping. Most appraisals cost around $300. A comparative market analysis is a real estate broker's or agent's less formal estimate of a home's market value, based on sales of comparable homes in a neighborhood. Most agents will give you a comparative market analysis for free. You can also do your own cost comparison by looking at recent sales of comparable properties in the public records. These records are available at the local Recorder, County Assessor, or through private real estate information companies.

Be Careful Please...

If you start out with a price that's too high, you may open a "Pandora's Box" in your marketing plans. Listing agents market and promote your home to hundreds of other local agents who are currently working with homebuyers. This dramatically increases your personal sales force. During the first couple of weeks on the market, your home should have a lot of activity with buyer's agents coming to preview your home so they can sell it to their clients. If you and your agent have overpriced the house, fewer buyer's agents will preview your home. After all, many of them are Realtors®, and it's their job to know local market conditions and home values. If your house is priced above the market, they won't waste their time looking at it. They'll just work with the homes that are priced very fairly. Later, when you drop your price, the house is "old news" - it can be tough to recapture the activity you would have had with a realistic price.

What if you do successfully sell it above the current market price?  The buyer will need a mortgage and the mortgage lender requires an appraisal. If comparable sales within the last six months and current market conditions don't support your sales price, the house won't appraise ... the deal falls apart. Remember, the appraiser works for the lender. He/she won't appraise the house for one dollar higher than the market justifies! You can always attempt to renegotiate the price... if the buyer is willing... but he's now in the "driver's seat". Your house could go back on the market... not good news!  Once your house has "fallen out of escrow"
or sits on the market awhile, it's harder to get a good offer because potential buyers will think you may be desperate, so they'll make lower offers. By overpricing the home in the beginning, you could end up selling it for a lower price than you would have normally received and it may take much longer to sell than it should have.

Marketing The Home - Continued on: [Page 3]