Pricing your home to sell I:
Perception vs. Reality

Well you’ve decided that you are going to sell the house you are in, and move. The foremost question in your mind is "What price can I expect?" The answer to this question is not always as cut and dried as you would think and unfortunately for most sellers the answer is not the same as "What price would I like?" We generally all have a very strong emotional attachment to our present abode when we think of all the good times we've had in the house and the hours we've spent renovating and redecorating. Another important factor is that you chose that house because you liked it and you were prepared to pay the previous vendors price, its nice to make a little tax free capital gain on the deal, right?

Your motivation counts a long way to setting a price you will be comfortable with. You may be simply testing the market, in no hurry to sell, or even prepared to let the market catch up to get the price you would like. On the other hand you may require a quick sale for financial or personal reasons. Make sure your listing agent knows what your situation is, it will affect not only the price but also the marketing method for your property. After all it's in the real estate agents best interests to make sure you get the results you want.

Valuations and Appraisals Pt 1

You will have some idea of the value of your house, if you take a look at you rates demand the Government valuation is written there, so you figure it must be worth a few thousand more than that, especially with the improvements you have done lately, right? Not necessarily, Although, over the entire country the average G.V. is actually within 1% of the average sale price, from town to town, and even street to street the difference may be around 30% up or down. An assessor looking at your house from the outside determines a GV, and making a judgement based on the age, size and location of your property. One point to note however is that a prospective purchaser almost invariably asks for the GV. They will always use this as a guide and there needs to be some outstanding features, not evident to the government valuer, for them to pay a price, which is excessively higher than the GV.

If your house is fairly new, you can take a look at the replacement cost, and depreciate it by a certain amount each year, say 2%. This method is fine for fairly new houses, but if you decided to sell a house built in 1950 I don't think you would be too impressed if I told you your house was worth nothing.

Valuations and Appraisals Pt 2

To get an accurate value of your property you can call in an independent valuer to prepare a registered valuation for you. A registered valuation will contain photos, maps and a full description of your property. It will state the fair market price your property should fetch if sold. It is very important that the valuation should be independent from anyone involved with the sale or marketing of your property. The drawback is that registered valuations don’t come cheap, they'll normally set you back at least a couple of hundred dollars.

Most Real-estate agents can provide you with a CMA. A CMA or Comparative Market Appraisal compares your property to others that are similar. Using both recent sales and presently listed properties, the Agent can give you a reasonably accurate estimation of your property's value. It lists the properties that you are in competition with for purchasers. You're able to see for yourself the same choices any perspective purchasers have and price your property accordingly. In regards to past sales it also lists the time on the market, the listing price and the sale price. A well priced property will have little difference between the list and sale price and will sell reasonably quickly. Poorly priced properties will have large differences between list and sale prices and will be on the market for ages.

Its my price and I'll cry if I want to…

Over time all properties will sell, that’s the good news. You have decided on your asking price, the signs have gone up, your property is on display in the window of the listing Agent or Agents, you property is even listed on the Internet. If within the first month, you have had a few people through and the "showings" are reasonably regular, you've probably priced your property close to the mark. Your agent should ring you and let you know how thing are progressing. If there have been few showings you may have priced your property to high, or there may be some street appeal problem with your property. It's hard to show off the marble-floored bathroom when a prospective purchaser can't see past the grass infested HQ Holden that is parked on the front lawn. With property one thing will cure things like poor presentation, poor location, or anything else, PRICE. Anyway, call your agent and ask him, point blank, "Why haven't you sold my property?" However only do this if your prepared to take his advice. The first month of marketing a property is the most important, it's fresh and new to prospective buyers. If someone loves your property, it's fresh to the market and competitively priced, purchasers will act quickly in case someone gets in ahead of them.