What Is Fair Market Value When Selling Your Home?
By definition, “fair market value is the price an informed buyer is willing to pay and an informed seller is willing to accept, neither party being under any pressure to act.” What the definition fails to explain is how to find that elusive amount or price.
However, in hindsight, you can determine the price through a careful historical analysis of recent sale prices. Properties that have already sold are proof that buyers and sellers were in agreement about price.
Actual sale prices are the best indicators of the prices that buyers are willing to pay home sellers for their home.
It doesn’t really matter what sellers think their homes are worth or what amount sellers feel they “need to get” out of their property to buy something else. The property will sell at fair market value and that’s it.
Sale prices are difficult to obtain without the assistance of a realtor. Realtors have access to accurate detailed statistics on all sales in the local market.
Actual sales figures are a valuable tool for arriving at fair market value. They show exacly what buyers are willing to pay for similar homes. Hearsay from neighbors or bragging by other sellers is not reliable information.
Contact a reputable realtor. Choose one who is familiar with your neighborhood and ask to see the selling price of all homes sold in your area over the past twelve to twenty-four months. Eliminate the extreme high and low ends of the price spectrum, then compare the remaining homes to yours.
A pattern of pricing will emerge, giving you a good indication of the appropriate price for your property. You may not like what you learn, as the price may be less than what you paid a few years ago. It hurts, but this is the reality in today’s market.
If you really want to sell your property, you must price within this range. Remember that buyers use this same information as a guide to buy.
You may use homes that are for sale now as a barometer of current asking prices.
However, while your home will be competing with others for buyer interest, asking prices are not “proven” until a sale takes place. Don’t put too much stock in those prices.
“Expired” homes indicate prices that buyers are not willing to pay! A home that is on the market a long time at the same price is also a good indicataor of a price that a buyer is not willing to pay! Avoid using either of these for price comparisons.
If you want to sell your home, you must detach yourself emotionally, look at your home from a buyer’s perspective and put a selling price on it!
Consider this. If you must sell your home for less, you may be able to purchase another one for less also. It works both ways! Get on with your life!
I once heard in a real estate seminar that there are only two reasons a home doesn’t sell. It is either under water or over priced! If your home isn’t selling and it isn’t under water, guess what? That’s right! It is most likely over priced.
Price it right and you will sell it!
I can help you do that! Bob Lewis does real estate right!
Call Bob!
Phone: 239-565-0330
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