So if you are in the market to buy or sell currently here in the Grand Traverse area or surrounding areas you know that our housing market is HOT. We are currently at a 3.4 month inventory which is actually up just slightly from the past few months. If you are a seller right now you’re in good shape, it’s not uncommon to see multiple offers and homes going for over asking. Now the common misconception with that is that home owners can over price their homes because they can get it, that couldn’t be more wrong but I see it all the time. You’d actually be better off slightly under pricing and driving multiple offers than over pricing and risking no offers. I could go into deep detail as to why over pricing is the worst thing a homeowner can do but to keep it short, you will almost always take less for your property by over pricing than if you priced correctly in the first place.
There are so many factors that go into pricing your home, the major ones are the most common: Size, beds, baths, sf, lot size, age, condition etc. But where do you go from there and how does an appraiser determine a homes value? Well believe it or not if you get 3 appraisals from 3 different appraisers you will likely get 3 different values, they will be very close but different. I’ve been through hours and hours of classes with licensed appraisers and to say it’s difficult would be an understatement. I use so many different formulas to determine value on different types of properties. Some of the basic standards we use to stay within the guidelines of how we think it will be appraised are things like not exceeding 10% in size from comparable sold properties. We also adjust sf of certain numbers depending on the type of home, average homes under $500,000 will typically take an adjustment of about $30 sf up or down, so say your home is 1500 sf and we’re adjusting it against a home that is 1600 sf we would make an adjustment of -$3000. Over $500,000 would be considered luxury and gets a bit trickier although we will typically adjust around $40-$50 sf. Keep in mind these adjustments can never except 1/3 of the comps price per sf, if so we make another adjustment. Lakefront is also a little different, we price the frontage by each foot and anything over 100 ft is priced at 50% of the first 100 ft and each lake and type of water front is priced differently. While I know i’ve probably lost you by now you get my point, this is just the tip of the ice berg when it comes to pricing. So if you are considering selling I highly suggest you hire an agent who knows their formulas because it is very complicated!
If you are in the market to sell your home I’d love to talk with you and give you a free fair market value.
Feel free to message me if you have any questions!