Dear Home Buyer,
There are some very good points made in the answers up to this point. Dave is right on target saying there is too small of a database from which to draw accurate conclusions about trends or averages. Billâ€™s line about there are as many markets as there are ecosystems in Orinda is perfect. Eric talks about agents taking listings at prices way above what they know should be the asking price, just to get the listing and later reduce the price. This is a disservice to the seller, ultimately costing them time and money, but it is commonly done, and partially explains the dramatically reduced selling price.
When my broker and I tour Orinda properties every Tuesday, we play a little game to hone in our valuation skills. We will tour a house not knowing the square footage or asking price before walking in. After touring the property, we will take into consideration location (on the street, in the neighborhood, in the city), the condition, the finishes, the updates, the feel, the comparable sales, the current inventory, all of the factors that make up a properties value.
We will first try and guess the square footage. Over the years, weâ€™ve become pretty good at estimating square footage. When we are off on a guess, it says something about the feel of a property, and the price will usually be off in the same direction.
Once we have the accurate square footage, we will put what we think should be the right asking price on the property. We are not basing our asking price on footage, but footage is one factor. If we estimate low on the footage, which says something about the â€œfeelâ€ of the house, we are then usually surprised at the high asking price, since a lot of people use the per foot strategy in setting their asking price.
Tracking where the houses end up selling, or not, usually proves us right in our valuation after many years of this exercise.
Weâ€™ve toured 31 properties in the last 2 weeks alone. Weâ€™ve toured thousands of properties over the years. There is no substitute for experience when it comes to valuing homes in specific neighborhoods.
You should, if you havenâ€™t already, visit as many open houses as you can on the weekends. Visit your price range stretched a little lower and a little higher. Go out with the intention of exercising your valuation muscle. You need to feel confident that when a house hits the market that fits your desires, you know the value. Or, you need to feel confident that your trusted adviser, your Realtor, knows the true value. Statistics do not always reveal the true story.