How are Sequim listing prices calculated? As a buyer, wouldn’t it be valuable information to know how Sequim listing prices are calculated? If you are a regular reader, you know that this Sequim real estate blog constantly gives you insider information that real estate agents know but rarely discuss with clients. I believe that clients should be fully informed, and I believe that all my clients are entitled to know how listing prices are calculated. This information directly impacts how buyers view purchase prices and how to negotiate the best possible price from the beginning.
Sequim Listing Prices
Sequim Listing Prices
True story. I met with a new client yesterday who has a gorgeous Sequim home for sale outside of town with a partial water view. It’s not officially on the market yet, because the first step in his due diligence is to interview two or three Realtors and have them look at his home and talk to him about its value. Obviously, he is primarily thinking about the appropriate listing price for his home. But he is not an expert on Sequim listing prices or how to arrive at a listing price for his home, so he must rely upon a Realtor to help him.
The story he told me is one I have heard from dozens of Sequim homeowners in recent years. He met with an agent who went out and pulled down a few comps (comparables) for the purpose of arriving at a listing price. He told me the comps were of homes that were not at all like his home. They weren’t just a little different, they were not even comparable. This is an all-too familiar story. The reason for looking at comparable homes that have sold is to get a good handle on what this home might sell for. But if the comps are so dissimilar, the prices the “comps” sold for are simply not relevant, and could actually be quite misleading.
Learning how to search and find “true comps” is both science and art, but it takes experience and some old fashioned hard work. Once the closest comps are found, price adjustments must be made to account for the differences. This too takes some knowledge of the value and costs associated with those differences. If this is not done very carefully and professionally, the recommended listing prices can be way off, and most often they are too high.
Sequim Listing Prices
When I act as a Sequim Buyer’s Agent for clients from California or other states, my clients and I get a very good idea of the true value of a home when we look at it, which means we know whether the listing price is reasonable or what I call, “within a range of reasonable values” for Sequim homes. When my clients walk into what turns out to be their ideal home, we both know if the listing price is reasonable.
What is the significance of Sequim listing prices that may be way off, i.e. too high? Many buyers who look at what could be their ideal home that is grossly over priced may not even make an offer on it. Guess who loses most when the listing price is way off the mark? The seller is the one who loses most, because there is almost certainly another home for that buyer that is reasonably priced, and if there isn’t, the buyer still has the option of building their ideal home. But the seller will only have one or two opportunities to connect with the perfect buyer. If he loses that opportunity, he might not sell the home for another year or two, and then he may end up reducing his price substantially.
I hope there are two valuable pieces of information you take away from this article. First, don’t assume anything about a listing price. It may be right, but it may also be way off. Second, and this will certainly sound self-serving, but you can see the importance of a knowledgeable and professional Sequim Buyer’s Agent who understands these issues and can protect you from paying more for your home than you have to. A good Buyer’s Agent can literally save you $10,000 or more on the price of your home, not only because he understands how to analyze prices and comps, but also because he is an experienced negotiator.
Now you know. Sequim listing prices are not always indications of true fair market value.
Last Updated on September 4, 2011 by Chuck Marunde
Guess who loses most when the listing price is way off the mark? The seller does, that’s a fact, I can’t agree more with this statement. Market price is set by the market and that’s the buyers, if the house is listed and is over priced the market will let you know by not making offers, worse by not taking the time to come and preview the house.