Coldwell Banker Residential Brokerage

Rye, NY | Rye Brook | Westchester County | Real Estate | Homes for Sale | Houses for Sale

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Market Analysis and the Evaluation

When potential sellers ask me to come over and give them a market value for their home, most homeowners are not aware of what we do and how we arrive at this figure. I will try to dispel any myths or pre-conceived notions you might be harboring. Also let me say all Realtors are not the same, and some agents might do or not do what I will be outlining below.

I find that some homeowners expect that we can give them a price for their home within 2 or 3 minutes of entering that home, which is impossible and totally irresponsible for an agent to do. (Unless they are walking into a cookie cutter co-op or condo, and know the actives and solds as of the hour).

My first step is the evaluation. I like to sit down and understand the motivation behind the homeowners’ thoughts about selling. It usually isn’t about the house or another house, it is a lifestyle change. The house is just a vehicle that will be used to transport a dream into a reality. Do they want to downsize? Are they growing their family and need more room? Do they want to cut their commuting hours to have more family time? Has there been an income change and expenses are escalating? Sometimes after hearing the motivations, I can suggest ways to reach their goals without actually selling their home or suggest alternatives that might work to their advantage. For me it is not about getting the listing at all costs, it is about helping people. If they don’t decide to sell, I know I have made a friend for life and they will always refer me to their friends and family. Being a successful Realtor is not about a quick sale, it is about long term relationships.

Once there is clarity about selling, I go through the entire house. I note the condition of each room, moldings and trim work, size of rooms, floor plan, take detailed notes about kitchen and baths, check all the mechanicals in the basement, walk around outside and note patios, decks, and privacy issues. I check the outside condition of the house, windows and roof. I am not an inspector, and I don’t pretend to be one, so I will ask many questions about any problems with heating systems, water damage, and electrical systems that you might have had. You must tell me the truth. If there is a problem, then we can discuss the best way to fix them before putting the house on the market, or let potential customers know about the defects. If I don’t tell customers about a leaking roof, whether they ask or not, they can sue you and me and have the sale voided by a judge and my real estate license could be in jeopardy. I will not go down that road. New York State has a law on the books that states a homeowner must fill out a property condition disclosure statement to the best of their ability. The buyers are entitled to this disclosure. If one has not been filled out, then the buyers get a $500 credit at the closing. I strongly advise my seller clients to fill one out and have all the facts about the house out in the open to avoid any potential litigation later on. Understand if you don’t fill one out, that does not exempt you from informing buyers to known defects about the house. Once the evaluation is complete I will take all my notes and leave.

I then go back to my office, take all these notes, and begin comparing houses sold, active and expired with the subject house. I compare everything from square footage, lot size, curb appeal, style, kitchen amenities, counters, appliances, baths, floor plan, flow, master rooms, size of bedrooms, and total condition of all utilities and the “guts” of the house to recently sold and active houses. I then take the comparable that I think closely match the subject house, run a comparative market analysis using these comps. Sometimes I have to factor in things that the analysis can’t, like neighborhoods and school districts. Another consideration recently has been the major flooding in some of our local areas that happened last spring. Some homes, who had never flooded for a 100 years, got water last spring. These are just some of the considerations that an agent has to factor into pricing. This stage of the evaluation to take all the notes and put them into a format that a homeowner can read and understand takes about 4 to 6 hours.

I will then return with the market analysis, explain the comparables I used and why I used them. Explain any adjustments I made to those comparables, e.g. 2 car garage vs. 3 car garage, and give my pricing picture to the homeowner. It is never a one figure price, but a range. In this market, pricing and time on market are in direct correlation to each other. The higher the price, the longer that home is likely to sit on the market. What no agent can predict, is that one single buyer who loves the lime green tile in the kitchen with the orange accents (you get my drift), and is willing to pay any price for this home. We know what appeals to the masses and can only price for that group. So I leave it up to the homeowner to set the price of their house within that range. It all boils down to what is motivating the sellers and what time frame do they need to sell their house.

As you can see asking for a market analysis is not a simple and quick process for an agent. So I do ask for all you curious homeowners who just want to know what their house is worth, and not sell…please tell us honestly what your intentions are. I don’t mind getting house facts over the phone, looking at similar homes and giving you a price range. I can do this in a 15 minute phone call. But I do mind you taking my time, (at least 8 hours in total), for a full blown analysis, just to be curious.

Some agents will try to do a one-step analysis. Come over, look at the house, give their notion of price, and try to have the listing agreement signed before they leave. Some first appearances of these agents is that they are very polished and knowledgeable. Ask yourself this question, do you really want an agent who has cut so many corners and is being irresponsible about their due diligence regarding the most important asset of your life? Most of the time these agents will spout a much higher price for the home then the market will bear. These agents are “buying the listing”. They want the listing at all costs, not really caring how hard it is to have strangers walking through your house day after day, and all the extra upkeep and cleaning it takes to show the best possible face of the home every day. This gets pretty frustrating after the first couple of weeks. Mark my words within 2 or 3 weeks they want you to drastically lower your price. Most people don’t realize that it is against our Realtor code of ethics to misrepresent to a homeowner what their house is worth. It is a very serious offense.

I don’t want to end on such a serious note, but selling your home is a big decision and I just want you to know that I take all my responsibilities to heart and try to give the best possible advice and counsel to all my clients. I also work very hard at marketing your home to the public and all the other cooperating agents on our Multiple Listing Service. That’s a whole other story I would need to describe. So call me over and I’ll tell you in person.

All My Best,

April Gasparino