3 Reasons Sellers Need a Realtor to Price Their Home

Automated valuation models often overlook key property-specific variables

There are dozens of Internet sites out there that reveal how much your home is worth. They are called “automated valuation model” (AVM) sites, which use statistical modeling techniques that calculate the property value by comparing it with similar-sized homes that have recently sold in your area. These tools crunch their data with publicly available numbers from several listing services and combine them with regional trends to set a sale price for your property.

Cool, right? Now, here is the question that every seller asks themselves: Do I still need a real estate agent to help me through this “assessment” process?

Well, there is a reason for the existence of a real estate agent; actually, I should say there are several reasons why these professionals are so important in any real estate transaction. May I dare to list these reasons?

1. These tools are not always accurate

Although most Realtors also use these tools to start a customer’s property evaluation, a lot of groundwork  is done after the results are revealed. Most AVMs confirm their evaluations may be off by around 5 percent. Well, actually they are sometimes inaccurate by up to 20 percent, according to a study by Standard & Poor’s (one of the reasons being that old data is being used, especially in a fast-moving market). This means that anyone strictly guided by these calculations can be way higher or under market and consequently be losing either money or possible buyers.

2. There are several factors contributing towards the price of a home that the tools do not necessarily catch

Several pieces of information compose the valuation range of a property. Market data is only one of them. The rest is very property-specific, such as whether you have made upgrades or whether your roof is too old — just to name a couple.

Other factors include where your property is located and whether it’s desirable for potential buyers. For example: Is the neighborhood safe? Are there good schools around the area? If I need to go shopping, can I just walk or do I have to drive a long way? The AVM tools cannot simply “know” these things.

3. Here is where a Realtor’s experience counts — A LOT — in this process

Real estate agents are trained to do a comparative market analysis, or a “CMA,” as we call it, for every property they list for sale. This includes going to the property and literally inspecting the home, the neighborhood, everything that will help pin down the ideal listing price range. But mostly, this will give the Realtor the ability to also “articulate” to potential buyers how the selling price is the right price.

TOGETHER (2)

Preparing a CMA is an art, not a science, I will dare to say. There’s no one size fits all. Well-thought-out CMAs need deep knowledge of the dynamics of property sales in a given neighborhood. The Realtor makes judgments based on their understanding of the local market and the dozens of peculiarities that affect price, such as lot size; lot orientation; tax-assessed value; and features of the lot, including its terrain, access and privacy, improvements and additions, condition, quality and age.

For example, your agent may know that an overextended home, the appearance of which is out of step with the neighborhood, will likely sell at a discount: An AVM will count only its square footage, and come up with a valuation that’s too high.

Every home is unique and must be valued accordingly.

Get it wrong and you risk deterring buyers, or not getting the money you deserve on a sale.

This post by Thomas Pidgeon was originally published on ActiveRain. After 30 years in senior management roles with corporations like Office Depot and Black and Decker, Pidgeon transferred his skills and experience when building the boutique real estate brokerage Florida 360 Realty

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How to Improve your Woburn Home’s Value!

A fresh coat of paint will make a room look new and clean and new carpets will make it shine that much more. Be sure to pick a paint color that is neutral as that will appeal to the most people. I have seen many buyers walk into a home with rooms painted the seller’s favorite color and just walk out because they hated it! Buyers also will always look down at the floor when they walk into a room. So be sure that the carpets are clean, and if they are worn, consider getting them replaced. Worn or dirty carpets and badly painted or dirty walls will make a buyer think that there are other issues with yourn home even if there is not.

Click the image below to find out your Woburn Home’s Value NOW and get the full report!

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Selling Your House? 5 Reasons to Do It Now

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Many sellers are still hesitant about putting their house up for sale. Where are prices headed? Where are interest rates headed? Can buyers qualify for a mortgage? These are all valid questions. However, there are several reasons to sell your home sooner rather than later. Here are five of those reasons.

1. Demand is Strong

There is currently a pent-up demand of purchasers as many home buyers pushed off their search this past winter & early spring because of extreme weather. According to the National Association of Realtors (NAR), the number of buyers in the market, which feel off dramatically in December, January and February, has begun to increase again over the last few months. These buyers are ready, willing and able to buy…and are in the market right now!

2. There Is Less Competition Now

Housing supply is still under the historical number of 6 months’ supply. This means that, in many markets, there are not enough homes for sale to satisfy the number of buyers in that market. This is good news for home prices. However, additional inventory is about to come to market.

There is a pent-up desire for many homeowners to move as they were unable to sell over the last few years because of a negative equity situation. Homeowners are now seeing a return to positive equity as prices increased over the last eighteen months. Many of these homes will be coming to the market in the near future. Also, new construction of single-family homes is again beginning to increase. A recent study by Harris Poll revealed that 41% of buyers would prefer to buy a new home while only 21% prefer an existing home (38% had no preference).

The choices buyers have will continue to increase over the next few months. Don’t wait until all this other inventory of homes comes to market before you sell.

3. The Process Will Be Quicker

One of the biggest challenges of the 2014 housing market has been the length of time it takes from contract to closing. Banks are requiring more and more paperwork before approving a mortgage. As the market heats up, banks will be inundated with loan inquiries causing closing timelines to lengthen. Selling now will make the process quicker and simpler.

4. There Will Never Be a Better Time to Move-Up

If you are moving up to a larger, more expensive home, consider doing it now. Prices are projected to appreciate by over 19% from now to 2018. If you are moving to a higher priced home, it will wind-up costing you more in raw dollars (both in down payment and mortgage payment) if you wait. You can also lock-in your 30 year housing expense with an interest rate in the low 4’s right now. Rates are projected to be over 5% by the end of next year.

5. It’s Time to Move On with Your Life

Look at the reason you decided to sell in the first place and determine whether it is worth waiting. Is money more important than being with family? Is money more important than your health? Is money more important than having the freedom to go on with your life the way you think you should?

Only you know the answers to the questions above. You have the power to take back control of the situation by putting your home on the market and pricing it so it sells. Perhaps, the time has come for you and your family to move on and start living the life you desire.

That is what is truly

The KCM Team

Woburn Market Update as of March 31, 2014

Woburn


3/2013

3/2014

Change

Number of  homes Sold

16

17

      +6%
Average List Price

$316,761

$359,600

+13%

Average Sale Price

$308,509

$347,514

    +12%
Median Sale Price

$290,770

$322,000

     +10%
Average DOM*

115

64

-44%

Average SP/ LP*

97%

97%

No change

Average SP/OP*

95%

95%

-3%

Lowest Sale Price

$117,600

$209,000

    +77%
Highest Sale Price

$507,500

$594,000

+17%

* SP=Selling Price  |LP= Listing Price |OP=Original Price | DOM= Days on the market

 

What is Available for Sale? 

 

As of March 31st, 2014 66 single family homes were listed for sale in Woburn, MA 4 homes are  Under agreement. However, 21 already have accepted offers with contingency. They continue to be listed as “Active” with a note that they can be shown on back up. That means that if the accepted offer falls through, a backup offer could be presented to the sellers. That means there are only 21 homes that are currently “available” for sale.

 

It’s a Sellers’ Market in Woburn, MA
You may have heard the terms “Sellers’ Market” or “Buyers’ Market”. We look at how long it will take to sell the current inventory of homes if no new listings come on the market and market conditions do not change. This is also called “Absorption Rate“.

 

How is the Absorption rate calculated?
Determine the number of homes sold in a defined area over a specific period of time, say 12 months.
Divide the number of homes sold last year by the number of sold this month (you will get the number of homes sold per month)
Divide the rate calculated by the  number of single family homes currently on the market.
271 homes sold in 2013
271/17= 15.94
66/15.94 = 4.14

 

Conclusion- it will take 4 months to sell the 66 listings currently on the market in Woburn, MAAn Absorption Rate of approximately 6 months is considered to be a balanced market. Anything below 5 month is considered to be a seller’s market.
In a Sellers’ Market, there is less inventory and more demand. So it is a great time for sellers to be proactive and take advantage of the situation.  If you are looking to list your home, please feel free to check my website for a FREE home market analysis.

 

 

 

201 Main St #21, Woburn

 

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201 Main St #21

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End unit townhouse at Village Estates awaiting your decorating touch! This home features: Open floor plan concept with bright Living room/Dining room combo corner fireplace, hardwood floors and a sliding doors leading to a brick patio overlooking the common area and the manicured lawn. Fully equipped kitchen has maple cabinets, refrigerator, stove, built-in microwave, and dishwasher and garbage disposal. Second floor has 3 very generous sized bedrooms including a large master suite with cathedral ceilings and master bath with Jacuzzi tub. Also, 2 good size bedrooms with plenty of storage. Design your own basement as you like or keep it as a great storage area. Attached garage and deeded space next to your unit. Walk to horn pond. Beautifully landscaped condominium managed by an offsite management company and an owner’s board of trustees. Conveniently located to I93, I95 shopping center, restaurants, and bus stop at your door.

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10 Ways to Prepare for Homeownership

10 Ways to Prepare for Homeownership

  1. UntitledDecide what you can afford. Generally, you can afford a home equal in value to between two and three times your gross income.
  2. Develop your home wish list. Then, prioritize the features on your list.
  3. Select where you want to live. Compile a list of three or four neighborhoods you’d like to live in, taking into account items such as schools, recreational facilities, area expansion plans, and safety.
  4. Start saving. Do you have enough money saved to qualify for a mortgage and cover your down payment? Ideally, you should have 20 percent of the purchase price saved as a down payment. Also, don’t forget to factor in closing costs. Closing costs — including taxes, attorney’s fee, and transfer fees — average between 2 and 7 percent of the home price.
  5. Get your credit in order. Obtain a copy of your credit report to make sure it is accurate and to correct any errors immediately. A credit report provides a history of your credit, bad debts, and any late payments.
  6. Determine your mortgage qualifications. How large of mortgage do you qualify for? Also, explore different loan options — such as 30-year or 15-year fixed mortgages or ARMs — and decide what’s best for you.
  7. Get preapproved. Organize all the documentation a lender will need to preapprove you for a loan. You might need W-2 forms, copies of at least one pay stub, account numbers, and copies of two to four months of bank or credit union statements.
  8. Weigh other sources of help with a down payment. Do you qualify for any special mortgage or down payment assistance programs? Check with your state and local government on down payment assistance programs for first-time buyers. Or, if you have an IRA account, you can use the money you’ve saved to buy your fist home without paying a penalty for early withdrawal.
  9. Calculate the costs of homeownership. This should include property taxes, insurance, maintenance and utilities, and association fees, if applicable.
  10. Contact a REALTOR®. Find an experienced REALTOR® who can help guide you through the process.

Source: Realtor.com