What You Paid Has Little or Nothing To Do With Your Homes Value: Part 8 of 8 - How To Effectively Price Your Home For Sale

Are you going to list your house for sale?  Are you writing offers to purchase, only to be turned down?  This post is for you.  Perhaps the hardest thing for sellers (and buyers for that matter) to wrap their heads around is the cold, hard fact that what you paid for your home, improvements, upgrades, etc. has absolutely nothing to do with its market value.  

Maybe you bought at the height of the market?  Maybe you bought at the bottom?  Maybe the home was part of your inheritance?  Maybe you bought it 45 years ago? Maybe the home across the street fell into the ocean and now you have the ocean view you always dreamed of!  It's all irrelevant.  100 years ago, today, and 100 years from now, real estate is, and always will be worth exactly what an able buyer is willing to pay.  

The house I grew up in was purchased, in Alamo, for $188,000 to be sold at a later date for  $1.4M.  Move forward 30 years and I hear, over and over, "I paid $859k for my house 5 years ago, now it's valued at $340k!  That's just not fair!"  What isn't fair?  Making a million dollars or losing it?  It's not a matter of fairness.  It's a matter of fact.

I recently had an experience with a buyer (whom I subsequently fired) who repeatedly remarked, "But this home was just bought at auction for $X!"   Had my filter not been in place, my response would have been more along the line of my thoughts, "So what!"  As a buyer, the only home values that matter are recent (and in the market the VERY recent) comparable homes sold.  I appreciate that it's difficult to sort of divorce yourself from this information, but...it's effective, and that's where we need to be. Pending home prices tend to be inaccurate.  Active prices are just that, asking prices.  Recently sold homes is the data you're looking for; specifically, that data as it compares to the subject property.

If you're selling, the same principles apply to you.  Don't get hung up on the amount you paid for your backyard hardscape.  Don't over estimate the value of that imported Italian ceramic tiles.  Your ideal buyer may rip it out anyway.  Yes, talk closely with your Realtor, sharing everything you've done to improve your property, but don't get caught up with how exactly how much each project cost.  Look at the market trends, and at comparable properties (if there are any). Depend on your Realtor to establish the best price to list at, then have him or her explain exactly why that is the right price!  Ultimately, the price you list your home for is your choice.  One thing is certain: If that price is too high...or too low...the market will let you know!

Until next time, and thank you in advance for remembering me when the topic of real estate arises, and THANK YOU SO MUCH all the referrals.

Andy Blasquez ~ The last Realtor you'll ever need to look for.
DRE# 01826135

www.andyblasquez.com

Email me at andy.blasquez@gmail.com
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