Last week I wrote about shopping for a home online. When to start, when to stop, and when to call a pro. Sellers, did you really think you were going to get away that easily? If you’ve read any of my columns you should know better by now…
Are websites an invaluable tool when selling a home? Absolutely. Are they the only one you need? Absolutely not. If you’re considering selling the first thing you want to find out is the value of your home. Naturally, in our ‘if you want an answer, Google it’ world the first place you look is one of the big real estate websites to get your answer. Sorry to let you down, but it won’t be the best answer. Here’s why:
The website you are looking on (we all know the one, so I won’t mention names) is getting its information from a variety of sources and from a variety of timeframes. Real estate is a very local and time sensitive market. Values can vary widely from county to county, neighborhood to neighborhood, and season to season.
When an automated value is calculated from an algorithm it is pulling from public records, typically tax offices. Sounds legit, which it is, however it is not an accurate portrayal of the open market. Value is defined as the amount for which one party is willing to sell and the other party is willing to buy. The issue is tax records reflect ALL transfers, not just those on the open market. There are estate settlements, foreclosures, family to family purchases, etc. This greatly skews values, both high and low, and can lead you to an inaccurate conclusion. The other issue I eluded to was timeframe. They will go back years which does not adhere to valuation guidelines used by appraisers and other real estate professionals.
What’s the answer? A local Realtor, of course! Why? Because we deal in what’s called ‘arms length’ transactions. We have two parties who typically do not know each other and are considering their own best interest when selling and buying. This gives a far more accurate picture of a property’s true value on the open market, or a ‘retail’ value so to speak. Plus, we have at our disposal information not available on the tax records such as seller concessions that should be taken in to consideration. And, perhaps most importantly, intuitive and hands on market knowledge because we are working our market every day. We know how far back to go in our research, which neighborhoods are comparable should we need to branch out, and how much value to apply for differences such as number of bedrooms and condition. Are we appraisers? Typically not, however we are in the trenches and most of us are happy to do a comparative market analysis (CMA) at little to no cost to help you make an educated decision before moving forward.
I hope this was helpful and please don’t hesitate to reach out with topics you’d like me to address. See you in February…
Melissa Berube, 2019 MBOR President