In essence, it is a sellers market due to the very low inventory. As we have recently seen, standard sales are valued by buyers, and they will often bid up the house. The main issue with pricing at a premium will be the comparables. If you can support your listing price, and believe it will appraise, then you should be in the clear. Of course, the seller can insist on the sale being non contingent on the appraisal.
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Buyers will pay a premium for a clean, move in ready house that provides a full disclosure and won't be tied up for months waiting for a short sale answer. The question is, how much of a premium? I think you discuss this with your seller and consider trying something 10% to 15% above the distressed properties.
Make certain your marketing indicates this is a house that is sharp, move in ready, can close in 30 days etc. I wouldn't include any distressed verbiage like "not a short sale,â€ to many buyers skim the remarks and will just see short sale and move on.
In a way, it's a great market for sellers considering the price points are the highest they've been in years and inventory is still low, but considering the interest rates are said to rise to about 5% by CNBC and other reputable resources I could argue it is a buyer's market at around 4% interest rates.
I have sold a standard home where there were distressed properties surrounding the property for over standard sale prices as some buyers don't want to wait for a short sale and need their home right away.
Seller's markets and buyer's markets are not something I go by in whether or not to sell as I see more often than not that individual's needs exceeds the current market.
Hope this helps.
JohnHart Real Estate Redefined
15125 Ventura Blvd
Sherman Oaks, CA 91403
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Alex Khalilifard | Realtor - General Contractor
BRE License #: 01937591
Listing and Selling Agent
try to figure the distressed to normal ratio by dividing the normally priced house into the typical distressed property value. Then price your house as the avg distressed property and multiply it by the normal to distressed ratio. In other words, the premium you mentioned in your question, is measurable and you are on the right track.
The appraisal will then be supported by non-distressed sale adjustment.
Thank you in advance.
Beachfront Realty, Inc.
Interesting question. Right now, true, there is less inventory on the market. At about this time last year there was about 20% more homes for sale. That includes SFR and condo's. Sherman Oaks tends to be a market that has a higher percentage of "good" homes. So, I am not sure that I would say there are no standard sales in that area for "good" homes. Most sellers really believe their home is much better than every other home out there.
I also would not agree that it is a "seller's market". Even with inventory down, banks are putting more foreclosures on the market and there are plenty of short sales coming this year. With interest rates at historic lows, I would tell sellers that it is a buyer's market and that they need to price and advertise accordingly. Anyone that pushes the idea that it is a seller's market is just trying to get a listing and are not reflecting reality. We probably won't have a true seller's market for a couple of years at least.
If a house is clean, staged correctly, marketed correctly and priced right, it will bring top dollar. The seller may just have to be a little patient.
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