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You Can Thrive as a Home Seller
Despite a Maze of New Challenges Created by Denver's Changing Real Estate
Market!
A 7-Insights Report written
by Mike Cooke
What
are 7-Insights Reports?
The metro Denver real estate market
has changed over the last couple years. While demand for resale houses has remained
strong, the number of homes on the market has risen significantly. The
bottom line is that you have more competition when you set out to
sell your house in today's market. Your house is under more scrutiny.
Increased
competition creates a number of
challenges for us in areas like pricing, pre-sale preparation, marketing, handling disclosures, etc. Here are some of the keys
strategies I'm using with my clients right now to insure that we are successful
in getting through
the home selling maze created by today's market environment:
No.
1 - Be more careful about determining the asking price for your home. You should insist of seeing a lot of detailed, written
documentation on the suggested listing price of your house from any agent
who is trying to get your business. Let me repeat that -- demand
detailed and written documentation about pricing. Here is why.
The comparative market analysis
methodology that is used to
estimate the market value of most houses has an inherent margin of error of
5% even when it is competently prepared. A hastily prepared or sloppy
analysis can easily by off by 10%!
When
real estate values were zooming up at double-digit rates of 12 to 15
percent per year, this kind of margin of error was not too much of a
problem. Even if you were overpriced by
5%, it didn't take long for the market to catch up with you and make your
price look reasonable. Overpricing was not a big concern.
But now we
have a different market. Average prices for the market as a whole are
edging up at low, single-digit rates. And even this is not true for every
market segment -- prices
may be flat or even falling in your particular price range or
neighborhood.
In this
type of market environment, you definitely do not want to be overpriced by
5%.
Here is what I'm doing right now
for my clients: I always begin my pricing
analysis with a complete and detailed comparative market analysis.
Although it has an inherent margin of error as described above, it is the
industry standard and needs to be included in your pricing decision.
Then,
I supplement this analysis with two or three other methods of estimating
market value. For example, I can sometimes use data on market appreciation
rates for your particular neighborhood to get a price estimate for your
house. In addition, I use a method that I call "feature
bracketing" that lets me compare your home to dozens of similar homes
that have sold recently -- instead of just the few homes typically
analyzed in a traditional market analysis or appraisal. Furthermore, I've
developed another method that places homes that are now on the market into
a color-coded, classification system that makes it easier to see how your
house, at various assumed asking prices, would stack up against the current competition in your market
segment.
By
ending up with three or four different estimates of the market value of
your home, we can get a better feel for its true market value. You'll have
greater confidence that you are getting top dollar for your property
without suffering the dangers that come from either over-pricing or under-pricing.
No.
2 - Maximize the cosmetic appeal of your property. Making a good
first impression is important in many endeavors and it is especially
important when selling a house.
Since
buyers form very strong first impressions based on cosmetic appearances,
we want to make sure that your house is "dressed for success".
 Here
is my basic game plan for figuring out what needs to be done to optimize
the cosmetic appeal of a house -- we go through each area or room of your
property and ask four questions: (1) What clutter can we get rid of? (2)
What items need to be repaired or replaced? (3) Can we improve the
appearance or functionality of a room by rearranging the furnishings? (4)
How can we accessorize to add pizzazz or flair?
For
example, we might de-clutter a kitchen by clearing off the countertops. A
peeling garage door could be repainted. A living room might look bigger if
we reposition a chair. We might remove books from a crowded bookshelf and
add some candles or flowers or knick-knacks to turn the bookshelf into an
accessorized, decorator item.
You
might think that we'd end up with an overwhelming list of things that need
to be done to get your property in tip-top showing condition. But I help
my clients prioritize the list and you will be amazed at how some of the
simplest items that entail little or no cost can make a huge difference in
the look and feel of your home.
Maximizing
the cosmetic appeal of your property is especially
important right now since there are a lot of homes on the
market. By helping you figure out how to make your home sparkle, I help
you get your house sold more quickly and for a better price.
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