Framing the Choices In politics, it’s often said that “whoever defines the terms of debate, wins.” The equivalent in real estate appraising would be, “whoever decides the geographic area for choosing the comp’s, defines home values.” What does that mean? One of the challenges choosing and analyzing “comparable sold properties” (comp’s) is coming up with...Read More
Misconceptions About “Comp’s” Perhaps no other term in real estate seems so straightforward, yet is so commonly misunderstood, as the term, “comparable sold property (“comp” for short). As Realtors and appraisers use the term, a comp has a very specific — and narrow — definition: namely, a recently sold, similar property that can be used...Read More
Where: The Whitney (downtown Minneapolis) What: 2,400 FSF condo with 3 BR/3BA How (much): ask price – $1.075M; sold price – $675k When: listed June 4; closed Aug. 13 Asking prices mean a lot less to Realtors than to the general public. Case in point: this 2,400 FSF condo at The Whitney, a high-end boutique...Read More
Overpriced Homes AndPhantom Negotiating LeverageIs a too-high asking price negotiating leverage? Apparently, some Sellers today think that it is. Instead of pricing their homes within the range suggested by the “comp’s” (comparable sold homes), they stake out a price as much as 30% above. Why? Negotiating leverage (presumed, at least). When their home doesn’t sell,...Read More
Four Questions to Ask, or, “Context, Context, Context” With multiple offers making a comeback — especially bank foreclosures that are “priced to sell” (and then some) — it once again bears asking: ‘how do you know if the property you’re interested in is really in multiple offers?’ Herewith are the four ways to tell. One....Read More
Pricing Psychology & the “Too-Precise” Price Quick, which home is priced more carefully: the one that’s $425,000, or the competitor down the street that’s $424,975? You’d certainly guess the latter . . . and you’d be wrong. It’s simply not possible to price real estate with the exactitude of a pound of hamburger, or a...Read More
