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The wife and I are contemplating selling our current home and moving out of state. We are currently in the pros and cons stage and waiting on a few job offers. We are also contemplating selling the house ourselves (without an agent), but are clueless on the process, know it would be a PIA, but the $$ saved may be incentive enough. We'll see about that. But I have one question (for now).
When it comes to getting a house appraised. I know the buyer will have their own bank appraisal, but when WE want to get a firm dollar amount of exactly how much our house is worth, is it always just based off of the area and other comparable houses in the general vicinity? If it is just based off of that, we know we would come out slightly ahead, but we have over $50K amount of upgrades inside that we want to take into consideration such as custom wallpaper, custom tiling around fireplace, "very" high-end kitchen appliances, custom paint/trim in certain areas, high-end floor tile, high-end fixtures, custom window blinds, and lots of other things that makes our house way more than "average"...lol. And we are mature enough to already know we won't get 100% return on those investments so please no flaming on that note.
Like I said, we are clueless, but are just trying to get an idea of where we stand at the beginning of this madness that may or may not happen. Thanks.
These items, in your list, will not increase your appraised value: custom wallpaper, custom paint/trim, custom blinds.
The other items you mentioned may increase it slightly, but no where near $50K worth. Those things were for your enjoyment. And since you mention custom this and custom that, there will buyers that don't share your taste and will mentally deduct from the price. Some buyers won't care about the high end appliances and won't understand the value.
Yes, appraisals are based on comparable homes that have sold very recently within a certain distance of your house. Appraisers try to get the houses that are closest in proximity and match up in terms of size, foundation, etc.
Based on your description you might come out a little ahead of nearby houses, but probably not as much as you would like.
An appraisal .... I'll give you a qualified Realtor's opinion, and perhaps a licensed appraiser will respond to you as well.
The appraisal is a professional opinion, at that moment, of the market value of your home. If you wait 3 or 6 months, it's no longer the current for value. Appraisers look for at least 3 nearby, recent, comparable-sized/bed and bath count homes. If you're in a large and active subdivision, they stay there, and get sales from the last 90 days. That is the clear preference of an appraisal.
Basically everything you cited is of nearly zero value on its own. If your home were more updated than the comparable sales, then there's a "condition" adjustment which would benefit you. Expect it to be <2% of value. But paint is paint, tile is tile (unless comps are all sheet vinyl), lights are lights, faucets are faucets. Your $5,000 stove isn't worth much more to an appraiser than my $800 GE.
Now, anyone can certainly sell their home themselves, without using a real estate agent. Generally the most successful FSBO Sellers have these 3 characteristics:
1. they've bought and sold enough homes to understand the process.
2. they are in a high-traffic/visibility area where "the market" will realize the home is for sale, and it's a desirable area.
3. They have a good idea of the value of their home.
You may have #2, but by your own admission not 1 & 3.
You should also be aware that ~88% of buyers use an agent, and they will expect that the Seller pays the agent's commission. So there's a great likelihood you'll save half what you think you are.
So if the other half is worth the "no clue how to do it", a pain in the ***, and $400 to get an appraisal (that may be worthless when thee Buyer gets theirs), then go for it.
Forget that. Hire an MAI appraiser. One that does not work for a bank and he doesn't want your listing as might a realtor. (I am a 30 year broker). He/she will charge you around $500 but it will be a non-biased appraisal. Armed with this document, price your home accordingly and if you want to secure a buyer, you will have to pay a buyer agent's commission.
A lot of those "custom" items may actually deduct from value rather than increase it, as it is almost 100% likely that buyers do not share your specific taste.
Without seeing it its hard to say how custom it us, but as a general rule, when improving to sell you rarely want anything too custom. You need to appeal to the widest buyer base possible.
Also buyers don't generally know or care about the difference between a nice fridge and a "very high end" fridge or stove or dishwasher or tile or fixtures or whatever so I wouldn't count on any return on that...
If the entire kitchen is updated though - great - that will help you sell....and increase your value, but only to the extent any updated kitchen in a home like yours near you adds to value. Over-improvement beyond the neighborhood norm offers very little, if any, return.
With that being said, sure you could hire an appraiser - they can give you a better idea than you have now...that doesn't mean buyers will necessarily agree, but it will be closer.
Or....since you really don't seem to know even where to get started to begin with, likely the rest of the process won't get better for you...and I think you should just let a pro handle this.
The wife and I are contemplating selling our current home and moving out of state. We are currently in the pros and cons stage and waiting on a few job offers. We are also contemplating selling the house ourselves (without an agent), but are clueless on the process, know it would be a PIA, but the $$ saved may be incentive enough. We'll see about that. But I have one question (for now).
When it comes to getting a house appraised. I know the buyer will have their own bank appraisal, but when WE want to get a firm dollar amount of exactly how much our house is worth, is it always just based off of the area and other comparable houses in the general vicinity? If it is just based off of that, we know we would come out slightly ahead, but we have over $50K amount of upgrades inside that we want to take into consideration such as custom wallpaper, custom tiling around fireplace, "very" high-end kitchen appliances, custom paint/trim in certain areas, high-end floor tile, high-end fixtures, custom window blinds, and lots of other things that makes our house way more than "average"...lol. And we are mature enough to already know we won't get 100% return on those investments so please no flaming on that note.
Like I said, we are clueless, but are just trying to get an idea of where we stand at the beginning of this madness that may or may not happen. Thanks.
1. Thinking you can save on a Realtor commission by selling it yourself is not correct. As an appraiser I can tell you that 95% of the properties I appraise that are sold FSBO either are considerably over priced which results in a longer than usual marketing time (and not appraising to contract) or under priced where the sellers leave anywhere from 8% to 14% on the table. Considering the customary broker fee of 6%, your way of thinking is wrong.
2. There are MANY tasks involved with selling a house: dealing with prospective buyers and/or "tire kickers", inspections, negotiations, paperwork, etc etc, among them. An agent is trained to deal with these issues.
3. $50K in upgrades: you should know that cost does not equate value. In fact, if those upgrades resulted in your house being an over-improvement in your market, you are likely not able to re-coup that investment unless you find a buyer who is willing to pay cash for the difference.
I could go on but I think the above points should make it clear enough why not listing your house with an agent is a bad idea.
It is like whatever the buyer is willing to pay, not like appraising jewelry where there is a world wide market for the materials and craftsmanship.
Any buyer will look at what has sold recently near you and balance that against any deficiencies in your home. Nice features don't count for value but may enhance the sale actually happening.
Good luck with your plan.
Our last sale was FSBO, but an agent found us and got half their normal commission.
It is like whatever the buyer is willing to pay, not like appraising jewelry where there is a world wide market for the materials and craftsmanship.
Any buyer will look at what has sold recently near you and balance that against any deficiencies in your home. Nice features don't count for value but may enhance the sale actually happening.
Good luck with your plan.
Our last sale was FSBO, but an agent found us and got half their normal commission.
what, may I ask, did you as Seller pay the agent as a % of the price?
Thanks for the feedback. I know I can say (without trying to sound snobby), we do live in a fairly new, gated community in one of the more desirable areas of outskirts of the city. House is 1 year old and before we even closed it was appraised $25K more than financed. I know the market is forever changing but we are fortunate enough to see the home values just on our street steadily increase over the past year. I know for a fact the two houses just across the street are well over $100K more than ours (the original owners of the land and family have two huge very nice houses on about 3 acres). I know we have a lot to consider and the reality/facts may let us down a little, but like I said, we are contemplating a lot of things now.
Last edited by Remington Steel; 10-25-2017 at 08:12 AM..
Forget that. Hire an MAI appraiser. One that does not work for a bank and he doesn't want your listing as might a realtor. (I am a 30 year broker). He/she will charge you around $500 but it will be a non-biased appraisal. Armed with this document, price your home accordingly and if you want to secure a buyer, you will have to pay a buyer agent's commission.
I agree and if doing a FSBO and a buyer shows with an agent, inform the buyer the house price is what it is and the buyer must make their own arrangements to pay their agent.
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