Hi Dianna,

You are absolutely right! You have to account for what similiar size homes are selling for on that desireable street and then subtract what it would realistically take to get the fixer up to par with the comparable homes. However, it depends on what micro market you are buying in. For example, some would say that if you find any half way decent home in the Albany school district, you had better jump on it before the 12 other buyers find out about it!

I wish I could give you a hard and fast answer, but the truth is that everything in real esate is relative. And on that same note, everything is negotiable, so I would recommend to get with a trusted Realtor and let them do all the hard work for you! Best of luck in your home search!

~Jessica

This a great question. The answer is, it will depend on where you are looking. Bay Area Real Estate is much like the weather; there are a lot of micro-climates. Oakland for example has a very wide range of values, and different markets in different areas.

Location has a lot to do with values.

Berkeley also has a range of values. A home in the Berkeley hills will be priced differently than a home in West Berkeley.

It is hard to give an exact formula for evaluating values, since knowing the trends in the localized market is very important to properly evaluate the value of the home. I have been working with a couple who have been looking in Berkeley and we have put in a couple of offers with multiple bids. The homes were in desirable locations, so inherent value to buyers is there.

My best advice is to really evaluate the locations you are looking to purchase. Some homes are selling quickly and others are not. Knowing the locations, the homes, and the situations of the sales will be helpful in determining what is considered fair market value.

If you would like some information about different areas in Berkeley or any of the surrounding cities, I can help provide information for you.

Good Luck!!

Lisa Cartoalno
Alain Pinel Realtors
510.213.1139

Vist my blog, Real Estate News Without The Schmooze at http://www.NoSchmooze.com

Diana
I am not an expert on Berkeley but I can tell you that I see the same thing here in the San Jose area. I see buyer's being very selective. Any negative on the house and they will absolutely offer low on the price. It can be in a good neighborhood, a nice house, but it has a quirky back yard or...whatever that doesn't make it a slam dunk and the price takes a big hit.

Most buyer's are wanting to offer 5% under whatever the list price is at. Sellers are trying hard to convince agents to list 5% higher to give wiggle room for low offers. That makes for some strange realities. Every buyer wants to tell their friends they got a great deal. And expect more because they are investing more in these homes than previous years because of lending changes. Every seller wants to say they didn't take such a hit. And as we know, it becomes more of an emotional decision than straight forward practicality.

I had a buyer the other day tell me that she wanted to offer what the house would be worth in a year. Unfortunately, even in this crazy market the typical offer pays today's "market value". In many cases that market value is completely driven on the seller's situation. If they are upside down on the home and must sell, or they have already bought another home, or other reason that makes holding on to the home for better times not an option, the price can take a big dive.

It may sound a little sarcastic, but market value is what buyer and seller can agree on. Some are willing to give up more. Some are willing to pay more. At least in this market, buyer's are having the choice based on the property and their desire in a home. Not too long ago they were simply buying anything in any condition to get a home. Which market was crazier? I am not sure.

CJ

What a great question. You can get close - closer in the more stable markets like Berkeley, but even so, it is like running after a train as it moves out of the station. We don't know if the speed it is going will be constant or pick up, or slow down as it goes. That is why we say real estate is not a science. Recent comps in Berkeley actually are pretty stable.