What’s Your Home Worth?
The value of real estate is a very hot topic. It doesn’t matter what is going on in the world. It can be a world pandemic, tanking economy, or the hottest real estate market in decades. People are interested in real estate. They are more particularly concerned about the value of their own home and there will be a wide range of opinions, depending on who you ask. So, what’s your home worth?
You may have seen memes like this and laughed – but they are pretty accurate in their description of how home values are seen. This is important to remember when buying and selling. As Buyers, we can be on two spectrums. It’s our dream home and we will give blood to get it – at all costs. Or, we like it but we like to play hardball and want to nickel & dime the Seller in an attempt to “get a deal.”
As Sellers, this is why it is so important to price your home within the market. You need to look at similar properties that are on the market, under contract, and ones that have sold recently. Yes, you may have imported the bathroom tile from Italy and wrapped all your ductwork in allergy reducing material but you need to understand that you may not get your money back, dollar for dollar.
We always need to consider other’s opinions of our home value. A lender will rely on an appraiser’s opinion of value and only lend based on that amount. An appraiser will look at comparable properties but they WILL take into consideration upgrades so it is a great idea to have a list ready.
Some people will say that a home is worth whatever someone will pay for it. That is true to a degree. If a Buyer has cash, this can be 100% true. If a Buyer does not have the ability to pay all cash or pay the difference between appraised value and purchase price, then they may be willing to pay an arm and a leg for your home, but just not be able to. Also, it is smart to consider the improvements in your home. A pool, for instance, devalues a home due to the safety concerns and insurance liability. For others, they are avid swimmers and would pay top dollar for a house that already has a pool.
Hiring a professional Realtor can really help you value your home properly. Pricing your house too high can lengthen the selling time, cause you to have to reduce your price, and possibly lose buyers. Pricing it too low could leave money on the table. Pricing it right within the market will get you the most money and sell your house in the shortest amount of time.
Lastly, when you are making improvements to your home, it is great to contact your Realtor to get their opinion. They can tell you what the trends are in the market for Buyers and they can also let you know what types of improvements and materials get the most return on investment. You may keep yourself from making a big mistake and losing money just by asking. If you don’t have a Realtor and need help, I provide this service for my clients and am happy to help you determine the best plan of action.
Michelle Froedge is a residential Realtor and Principal Broker in the Greater Nashville and Williamson County areas of Tennessee. “Mom” to four-legged fur baby, Tyler, Auntie to Zelamie, she is a vegetarian and sings in her spare time. Michelle has lived in Nashville and Franklin since 1997 and has been selling homes since 2004.