how to price your home
Ever wonder how to price rural property for sale in northern California when there are no comparable sales? This is not for the faint of heart, that’s for sure. First, there are so many factors, one being construction type, like a log home. If you’re lucky enough to find another log home, that is a start; however, it won’t be the same size or may not have your desired 360-degree wrap-around porch. Again, it is a start. But the acreage — is it usable? Is it functional for raising animals or vineyards? So many variables.
If you are looking for comps in a rural area, so often you may need to expand, to go out into other ZIP codes. Sometimes, moving to even neighboring (sister) ZIP codes until you get a flavor for pricing. Look at all of the closed sales and ask yourself, what are they averaging? Then, find one property to hang your hat on as the best comp, similar for size, acreage, year built, quality of construction and finishes. Then start to adjust amenities from there on with other potential comparable sales.
Pricing custom rural property is a tremendous job, a tedious body of work. What is interesting is you can easily take money from unsuspecting victims. Appraisers that set values for lenders are often not even from the same area. Some have little to no experience with rural, yet they set the value for what a property is worth? How to price rural property for sale in northern California? There is not a simple answer. It is a process, and when you do the work, there is a confidence that arises as the numbers do not lie. If you are not sure, keep working. Call agents on other properties find out how much action they have had.
A Realtor, though not a licensed appraiser, can prepare a market analysis that will undoubtedly give a healthy price range. The bottom line, put in the time to analyze everything you can get your hands on. Also, look at vacant land values as this gives you a look at the land acquisition cost. A shop and outbuilding are not worth what you paid to construct them. A garage value in an appraisal is about $20,000, but try to build a high-quality solid garage with a 50-year roof to match a custom home for $20,000? Much like a $50,000 swimming pool, approx worth in an appraisal, $15,000.
Fantastic mountain views are subjective as you would need to find similar properties without views and then compare against property with views to figure out the actual difference in property values with a view. If you have sold hundreds and hundreds of homes, and you understand the math of an appraisal, you can come close in a very complicated property market analysis. Am I saying it is easy, no way? This is definitely where an experienced Realtor pays off for you.
Further, the market tells you so much. If you are getting hundreds of online views of your video and photos and no one is coming to see it, chances are you may be priced high. Here is the beautiful thing, if you price a bit low, sometimes it creates a bidding war, and a property sells for more than list price. We once had a buyer come up over $500,000 due to a bidding war on a rural farm in Elk Grove. Does experience count? I think it does what do you think?
I recently had an appraisal done on a property in Elk Grove as the seller would not listen to me and thought I had undervalued her home. The appraiser came in $30,000 under my market analysis. I sold it for $30,000 over that appraiser’s value. The second bank appraiser used my comparables and came in at the list price; the seller was ecstatic. This happens more than you think.
Like any job involving collaboration among professionals, there are some fabulous appraisers with whom I consult, and the difference is they put in the time and utilize their tremendous experience. We can always learn more about establishing list price values. To this day I keep copies of appraisals; they are a fabulous tool. Does experience count? I think it does. Call Weintraub and Wallace with RE/MAX Gold to obtain a free market analysis on your property. We can be reached at 916-233-6759.
— JaCi Wallace
If you would like to hear something hilarious about Zillow and Zestimates, consider this. When I asked a new agent in my Midtown Lyon office what he thought about a listing I had placed on Lyon broker tour a few months back, he said that he believed we had priced it too high. When I asked him to explain how he came up with that idea — because when an agent is still in training, you never know what process they use to determine value — he said he looked it up on Zillow.
My mouth fell open in shock. I’m afraid I gave him a lecture, probably a speech he was not expecting, about how no professional real estate agent anywhere in the country ever in a million years would rely on a Zillow Zestimate, and if he wants a future in the Sacramento real estate business, he needs to learn how to estimate value independently. Don’t you be caught dead taking a Zestimate, I warned. Pricing a home is a service we offer, as a Sacramento Realtor, to our clients. We must be able to accurately and precisely compute market value.
I don’t think that guy is talking to me anymore.
It doesn’t matter if you’re a buyer’s agent or a listing agent, or you do a combination of the two services, an agent needs to know how to price a home. If only life were that simple that we could go to a public website and gather all of our information and never have to retain a specialist for services, but that’s not reality. Not for now, anyway.
We can’t use FaceTime for a doctor visit, although that’s a pretty good idea. You know, we could always drop by around lunchtime to offer a sample of blood or have our vitals taken in a private drive-through booth. Instead of wasting time sitting in the damn waiting room and reading old copies of Golf Digest.
To price a home for sale, there are many values to take into consideration and to compute that far surpass the data a person can obtain on Zillow. It doesn’t mean that Zillow is bad by any stretch, there is a lot of excellent information on that site, and sometimes, let’s face it, I admit to stooping so low as to tell other buyer’s agents, hey, go look at Zillow. The Zestimate for my listing is $625,000 and yet it is for sale at $575,000. What a great deal for your buyers! Send your buyers to Zillow, too!
Some of those agents, let’s face that, too, they don’t know any better, as evidenced by that new agent in my office and my daily interactions with other buyer’s agents.
I check out the Zillow Zestimate so I can properly explain to my sellers — whom you can bet your bottom dollar have already looked at Zillow — why that value is incorrect. That’s one of the reasons they really need a top listing agent. Because the professional Sacramento Realtors, well, we don’t rely on Zillow for market value.