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Old 03-04-2014, 12:46 PM
 
Location: Maine!
470 posts, read 1,783,358 times
Reputation: 320

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We are preparing to put our home on the market and our realtor ran the comps and gave us a figure to price our home. We really don't want to sell below that figure and of course, sell as quickly as possible. Besides square footage, floor plan, and what has sold in the past XX months, what dictates this figure? Do improvements help the bottom line? Since we moved in almost 5 yrs ago, we added a privacy fence, reno'd the kitchen, added ceiling fans throughout, traded out carpeting for flooring, and w/in the last year replaced the roof. Do these changes even play into the pricing? BTW, we're in SC.
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Old 03-04-2014, 12:59 PM
 
Location: Needham, MA
8,047 posts, read 12,515,036 times
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There are a lot of factors that go into choosing comps. First, I try to use comps with a similar location (i.e. in the same neighborhood or ideally on the same street). Next, I'll whittle that list down by picking homes that are similar in style to the subject property (i.e. I wouldn't compare a colonial style home to a ranch style home). Last, I'll try to whittle the list down by the measurements of the homes like acreage, gross living area, floor plan, number of beds & baths, etc. Then once I have my comps I'll make adjustments to the price the comps indicate based on differences in condition between the comps and the subject property.
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Old 03-04-2014, 01:01 PM
 
Location: The Triad (NC)
32,726 posts, read 76,701,511 times
Reputation: 40731
Quote:
Originally Posted by thechappells View Post
We are preparing to put our home on the market and
our realtor ran the comps and gave us a figure to price our home.

Since we moved in almost 5 yrs ago, we added a privacy fence, reno'd the kitchen, added
ceiling fans throughout, traded out carpeting for flooring, and w/in the last year replaced the roof.

Do these changes even play into the pricing?
Sorta to Yes. The more that work was objectively called for the closer to yes you get.
But if you're in a $200K 'hood you aren't likely to get $300K no matter what you do.

Mostly what that work will do is make/help YOUR home stand out from the other homes nearby
which haven't had that work done... which will TEND to help sell a well priced home faster.
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Old 03-04-2014, 01:04 PM
 
Location: Salem, OR
15,205 posts, read 38,020,497 times
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Out here the roof, fence, flooring and ceiling fans would add little value, unless you went from carpet to hardwoods. A roof is a maintenance item, not an improvement.

The kitchen renovation, if it was new cabinets, counters, flooring, sinks and appliances would add value assuming your comps didn't have that.

Comps are evaluated on the following for a typical subdivision home in my area.
square footage
number of bedrooms and bathrooms
lot size
garage size
floor plan, functionality
neighborhood
time frame, preferably sold within the last 3-6 months
finish level (compare granite and hardwoods to granite and hardwoods)
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Old 03-04-2014, 01:49 PM
 
Location: Maine!
470 posts, read 1,783,358 times
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Good info. Thank you for the quick replies...there is a home (on our street) with the same floorplan that's been on the market since May '13. No "improvements". And they've had a price drop or two since being for sale (a bit higher than our current proposed figure)...hopefully, it'll work in our favor.
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Old 03-04-2014, 03:04 PM
 
Location: Needham, MA
8,047 posts, read 12,515,036 times
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Quote:
Originally Posted by thechappells View Post
Good info. Thank you for the quick replies...there is a home (on our street) with the same floorplan that's been on the market since May '13. No "improvements". And they've had a price drop or two since being for sale (a bit higher than our current proposed figure)...hopefully, it'll work in our favor.
"Comps" is actually short for comparable sales. If the property is not sold then it is not a comp. Active listings don't add a ton of insight. If you told me this house was nicer than yours and it wasn't selling then if I were your agent I would advise you to price under what this house is priced at. However, you seem to think this house should sell for less than yours (a common statement among homeowners and not always right - no offense). It's possible this other house is listed so high though that you should still list for less than this house. In the end, this listing doesn't tell you a lot except that it hasn't sold. I try to stick to sold listings first, but I will venture into under contract listings which don't add as much insight but they are more up to date than sold listings. I try to stay away from active listings when determining a list price or market value.
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Old 03-04-2014, 03:24 PM
 
Location: Maine!
470 posts, read 1,783,358 times
Reputation: 320
Quote:
Originally Posted by MikePRU View Post
"Comps" is actually short for comparable sales. If the property is not sold then it is not a comp. Active listings don't add a ton of insight. If you told me this house was nicer than yours and it wasn't selling then if I were your agent I would advise you to price under what this house is priced at. However, you seem to think this house should sell for less than yours (a common statement among homeowners and not always right - no offense). It's possible this other house is listed so high though that you should still list for less than this house. In the end, this listing doesn't tell you a lot except that it hasn't sold. I try to stick to sold listings first, but I will venture into under contract listings which don't add as much insight but they are more up to date than sold listings. I try to stay away from active listings when determining a list price or market value.

No offense taken. I think you misunderstood me. I actually think the other house is priced a bit high for our area and as long as we can sell our house at the proposed price, I'm good. Would I like to get more? Heck yeah! But as long as we can sell this place and quickly, again, I'm good. Thank you for clarifying "comps"...I guess as future sellers, I'm looking at all properties--sold and for sale.
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Old 03-04-2014, 04:07 PM
 
Location: Riverside Ca
22,155 posts, read 29,690,713 times
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It's probably been said but comps stands for comparable. Price or features.

When a agent pulls a comp they are selecting houses in your area that have the same features like bedrooms lot size single or two story pool or RV access etc.
This way you can compare your house to what sold in your surrounding area. I'm sure it's only a fairly set circumference. You can't compare your house to one on the other side of town 5 miles away.

Pricing is basically the asking or sold prices of houses like yours or as close to yours as possible. I NEVER use asking prices to gauge the worth of a house. RECENT sold prices and the CURRENT housing market is all that matters.

Example. Early 2013 houses were steak to starving people. 1/2-3/4 into the year housing slowed down. At the end of 2013 you could of had a better deal if you caught a early winter seller.

Some of these guys and gals on here are pretty smart people. I know I learned a few tricks.
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Old 03-04-2014, 04:29 PM
 
Location: Massachusetts
6,300 posts, read 8,917,124 times
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Quote:
Originally Posted by MikePRU View Post
There are a lot of factors that go into choosing comps. First, I try to use comps with a similar location (i.e. in the same neighborhood or ideally on the same street). Next, I'll whittle that list down by picking homes that are similar in style to the subject property (i.e. I wouldn't compare a colonial style home to a ranch style home). Last, I'll try to whittle the list down by the measurements of the homes like acreage, gross living area, floor plan, number of beds & baths, etc. Then once I have my comps I'll make adjustments to the price the comps indicate based on differences in condition between the comps and the subject property.

This is all very insightful.

How do trends factor into comps or appraisals? Suppose properties similar to OPs either sold 10% higher or lower on average from 2012 to 2013.

I've also read that there is a formula that is used between properties that have a certain feature vs. properties that do not (bathrooms, elevators). I read that a half bath can be worth $2,000 and an extra full bath $5,000.
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Old 03-04-2014, 07:20 PM
 
Location: Maine!
470 posts, read 1,783,358 times
Reputation: 320
Excellent question, 495. Appraisals. How does that play into this? Or does it?
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