With comps 'all over the place' price wise , what is the best way to VALUE a house in todays market , short of getting it appraised ?

Asked by Roberto Perez, Homestead, FL Tue Nov 29, 2011

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9
Ron Thomas, Agent, Fresno, CA
Tue Nov 29, 2011
Believe it or not; a CMA is a better indicator as to the Market Value of a House than an Appraisal is:
A CMA, done by your Realtor, will look at all Comparable Houses within a certain radius.
An Appraisal will start with a preconceived number, (your loan amount) and work around that number.
A CMA is free.
An Appraisal cost you about $450.
This is really more of an ART than a SCIENCE, because we really do not know the WORTH of a house until someone makes an offer on it.

Good luck and may God bless
2 votes
Shawn Ryan R…, Agent, Belleville, NJ
Mon Dec 5, 2011
Comps are not "all over the place," as long as you are comparing similar properties and distinguishing between short-sales, foreclosures, and full arms length transaction. FInd a good local realtor and they will be able to pinpoint a home's value with ease.
0 votes
Genevieve Ra…, Agent, Punta Gorda, FL
Mon Dec 5, 2011
Roberto,
On each property, you'll have to make adjustments. Are you working with a Realtor? That would be your best bet.With value constantly changing in this market, you need a professional to help you.
Good Luck!
Genevieve Ramachandran
0 votes
Gary Hitchco…, Agent, Coral Springs, FL
Fri Dec 2, 2011
Even though the comps are all over the place, your agent should be able to make adjustments using appraisal concepts to determine the value of the house your looking at. For instance in the neighborhoods I work, appraisers use $100/square foot to adjust homes of different size, $25,000 for lake views, etc. So if your agent knows the neighborhood and surrounding neighborhoods within 1 mile, then he/she should be able to determine the value.
0 votes
J, Agent, Greensboro, NC
Wed Nov 30, 2011
The "sold" value of comparable houses located near your house is a good indicator of value and what a buyer is willing to pay in today's market. I once challenged an appraisers information on a report because the comps being used were not of similar comparison to a property to be sold on the open market. The appraiser's comps were nearly 30K higher. Trying to explain this to the sellers with written credibility to back up my response was an even bigger challenge and resulted in the sellers using a different agent to list at 30K higher. Unfortunately, the house never sold after being on the market 8+ months.

It is a major plus for a buyer's agent working with a buyer to submit a credible comparable market analysis when making an offer on an obviously over priced house. This can be a powerful tool when negotiating for a buyer client and getting them the very best deal. Good luck to you!
0 votes
Lila Lopez, Agent, South Miami, FL
Wed Nov 30, 2011
Good Morning Roberto,

Like anything else, a CMA is only as good as the agent that is putting it together. For a CMA to be the most accurate an agent will need to take a look at the subject property house to know the interior condition, amenities, upgrades, and the overall condition in order to properly compare it to other homes in the area. Value is not determined by square footage alone nor location, there are many things to take into consideration, and the CMA will give you a good range of what price to set a home. Given you appear to be a buyer, your realtor should be able to give you the closed sales in the area once you have decided upon a home to make an offer, as you will have seen it and know what you are comparing. Whether we like it or not, once you have an offer accepted by a seller, the final decider of the value will be the appraiser that is sent out by your lender. If the appraisal comes in lower than the sales price you can either pay the difference or you can renegotiate the contract. Good luck in your home search. If you have any addtional questions please feel free to contact me.

Lila Lopez
RE/MAX Advance Realty
305-772-2521
0 votes
Anna M Brocco, Agent, Williston Park, NY
Tue Nov 29, 2011
Don't rely on online comps as some of the information may be inaccurate nor updated; rather work with an agent, he/she can provide you any necessary information....
0 votes
Ann Ryan, Agent, Doral, FL
Tue Nov 29, 2011
Ask local real estate agents for a CMA! I'd be happy to run one for free, as would most of the other agents hanging around the Q&A. All I need is your address. I should be able to get back to you within an hour, provided I'm available when you get me the information.
0 votes
The Goetz Gr…, Agent, Englewood, CO
Tue Nov 29, 2011
The best way to value a home is to look at how many homes are on the market currently, close by, that have relatively the same specs (beds/baths/etc.). I normally go about a mile out in radius unless it is downtown Denver, then it is more like 5 or 6 blocks. From there you need to know about the finishes and upgrades that each of the homes have, so you can determine the order in which they will sell (price doesn't matter yet). From there, look at how quickly homes that are comparable to the subject property are selling. So here's the example:

Subject is property A. A has 3 comparables: B, C, D. They are all 2Bed/1Bath homes. B is listed at $110K, C is listed at $105K, and D is listed at $120K. You tour the properties, and determine that B has the best finishes and layout, D is second, and C is third (A would be second if considered). You look up how long it is taking 2B/1B homes to sell in the area, and determine that it is 60 days. If you want the home to sell first, it will need to be priced at $109K, or in that area.

I know that doesn't exactly answer your question, but value is determined by the market, and it is constantly changing. This is the way that I price homes, and it works fairly well for me.
Web Reference:  http://masongoetz.com
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