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Property Worth

Beware:

Hyde Realty can help price your property correctly so your home sells quicklyIt is often a mistake to list your home with the agent who suggests the highest price, as they may be simply trying to "buy" your business. While it is true that you can always "come down", there are many factors to consider. Firstly, the market is always looking for new listings. This means that the first few weeks your home is on the market are crucial and can often bring more inspections than any other time. Many of the buyers in the price range will rush to see your home. Those who have been looking for some time are often the ones who have done their homework and are ready to buy. But they will also be the most aware of the market value of your property.

Pricing / Hazards of over pricing:

If your home is correctly priced it will make buyers feel they need to snap it up before someone else does. Then you have the best chance to achieve the result you wanted and have a result in the shortest possible time.
If the price is too high, (or the property is ‘overpriced’) buyers feel no sense of urgency. Just as owners take the attitude "we can always come down", buyers think they will wait until the price drops.

So you need to price your home so that it offers the best value for the money at whatever price range it may fall into. This then gets the attention of more buyers and therefore creates more competition for your home and a better result, sometimes a result beyond the initial asking price. This is a much better method than pricing your home higher with ambition of getting that dream higher price, but then placing your property in a price range where other homes at that range may have more to offer. By doing this you risk over exposing your property, and by the time you reduce it to market value, active buyers may not consider it because it has been on the market for a while and gives the impression that there may be a problem with the property. Then, by the time a sale is achieved it may have taken a lot more time than necessary and the final selling price may be lower than what you could have achieved if it was priced correctly from the start. It is hard to get back that initial interest buyers show homes when they first hit the market.

For example: A property that ‘could achieve’ $500,000 when first placed on the market, may only achieve $470-480,000. Because it has become ‘stale’ after being on the market for a number of months at a price higher than the realistic market value of $500,000. The longer your property is on the market, the more buyers feel they have the negotiating power.

Other Hazards of overpricing can range from:
  • The lack of enthusiasm from salespeople, making it less likely to be shown. Smart agents won’t waste time showing overpriced houses.
  • Length of time to obtain a sale.
  • Bank appraisers not seeing the value in a property when looking to finance a potential buyer.
  • Buyers thinking that it is out of their price range, therefore not looking at all. Then when the price is reduced, potential buyers have been lost.

What’s Your Property Worth? / Comparing Your Property:

It is important to remember that a buyer will always want to get the most value for there dollar. So as the age old saying is true, “Its worth what somebody will pay”, somebody will only pay money for a home if they believe it will suit their needs and is priced correctly compared to other comparable homes in the market place.
As the market changes rapidly year in year out, so does the value of real estate due to many factors. So usually the price you achieve after a successful sale is very different from the price you may have paid to buy that property, or from the estimate you may have got during a market update or appraisal.

So working out how much your property is worth is based on a few things:

  1. The sale price of comparable properties in the recent past with similar features, in the neighborhood. A (CMA) – Comparative Market Analysis.
  2. The asking price of comparable properties with similar features in the neighborhood, that are on the market at the time of pricing your property.
  3. The internal and external condition of these comparable properties compared to yours.
  4. Leans against the property.
  5. Pending plans for the surrounding environment. E.g. Future developments or changes to local areas. (Can increase or decrease value).

When an agent suggests a selling price, the seller should ask for a list of “comps” (Comparable homes) to see the evidence the agent is basing his figure on. Remember some agents will purposely tell you a higher than realistic price to trick you into giving the listing to them. The price might sound great but flattery will not get your home sold.

Remember, if your not getting offers after a certain amount of time, the public is telling you something. The homeowner & agent can set a price, but the public will tell you what the house is worth.