Determining
your home's value
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| The real estate market is
in constant flux, not only as a whole but in particular
areas as well. Knowing what is going on in the overall
and local real estate markets will help you understand
how these conditions can affect the sale of your home. A "buyer's market" occurs when the supply of homes on the market exceeds demand. Characteristics of a buyer's market include: high inventory of homes; few buyers compared to availability; homes on the market longer; and prices stable or perhaps dropping. Implications of a buyer's market include: buyers spending more time looking for a home, and when they negotiate, usually having more leverage. A "seller's market" occurs when the number of potential buyers exceeds the supply of homes on the market. Characteristics include: a smaller inventory of homes, with many buyers; homes selling quickly; increasing prices. Implications of a seller's market include higher, or climbing prices; the need to make buying decisions more quickly; and conditional offers may be rejected. A "balanced market" is one where the number of homes on the market is roughly equal to the demand. Characteristics include: demand equalling supply; sellers accepting reasonable offers; homes selling within reasonable time periods; and prices generally stable. Implications include: less tension between buyers and sellers; and a reasonable selection of homes to choose from. An experienced agent will be able to tell you all about the current state of the market. |
| The market ultimately determines the true value of your property. Before comparing your home to similar properties, and establishing a competitive list price, the following points should be considered. |
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| A competitive market analysis (CMA) is an indicator of what today's buyers are willing to pay for a home. It compares the market activity of similar homes to yours in your neighborhood. Those that have recently sold represent what buyers are willing to pay. Homes currently listed for sale represent your competition, and what those sellers are hoping to obtain. And those that have expired can be considered overpriced, in the buyers' eyes, or poorly marketed. Your realtor should prepare a CMA for your home based on the most current market information. This will enable an intelligent decision, between you and your Realtor, regarding the proper list price for your home. |
