THE VALUE OF AN APPRAISAL
Sellers: What is the #1 Tip for Selling Your Lakefront Home in 2017?
Answer: Complete a professional real estate appraisal!
It is a fundamental truth in today’s real estate market - your opinion of value, the Realtor's opinion of value and even the Buyer's opinion…are by and large irrelevant! The only opinion that validates pricing is the buyer's lender…per the bank’s appraisal prior to Closing. Why risk losing a sale or conceding to a lower price that late in the process? Here's why it makes sense to be proactive:
Rule #1: Buyers are well educated and understand the market.
“My home is very unique and a buyer who understands that will gladly pay for it”. Many sellers feel they know the value of their home and/or think that a buyer will pay more because of their desire to live the lakefront lifestyle. In today's market, no one will pay over the bank-appraised value for any home. It does not matter how much they love it - they will not start in a negative equity position. Buyers will use the lower appraisal to re-negotiate.
Rule #2: A proactive valuation puts you in control.
“What do I do when a buyers submit a lowball offer for my home?” Having the appraisal is a powerful trump card. It allows you to justify the price and negotiate quicker, based on certified current market data. We recently had a seller negotiate an offer from $400K to full asking price of $425K within one counter-offer simply by presenting the appraisal.
Rule #3: Testing the market does not work.
"There's no harm in starting with a higher price, I can always come down later". Here is why this does not work: 1) the best chance you have to sell at full asking price (or over) is within the first two weeks on the market. After that, you will not sell for full price! (2) All you are doing is helping sell another lakefront home. Buyers will compare what they get for their money and buy your competitors home. (3) Buyers know the market. Not only will they not come to see your home, they will black-list it…even after you start dropping the price.
Rule #4: Justify with logic.
"Several Realtors have seen my home and their prices are inconsistent". Lakefront properties are difficult to price, especially for Realtors that do not specialize in them. The additional value that a waterfront property brings is subjective and need to be quantified through a statistical process. Professional real estate appraisers are trained and licensed to do just that. That is why these appraisals are much more powerful and useful than a Realtor’s assessment. Buyers will eventually get past emotion and will want to justify with logic. Give them the data to finalize their decision.
Rule #5: Stay focused on the process.
"The buyer's lender can't use my appraisal anyway; they have to get their own". Yes, but first things first. Price it right and negotiate the best sale. Then you can provide your current appraisal to the lender's appraiser for reference. Lakefront comparables are tough to find…they will appreciate the head start.
Rule #6: Stay ahead of your competition.
There are lakefront homes for sale all around you that most likely did not complete a professional appraisal. That's why their home is lingering on the market, over-priced, getting stale and chasing the market down. Had they priced it right from the start, they would have saved an enormous amount of time and energy. Start by pricing your lakefront home correctly. Your goal is to sell your house, not theirs.
Rule #7: Appraisals pay for themselves several times over.
"I don't want to spend $350 for an appraisal". Remember, this is the ONLY price opinion that really matters in today's market. You can accomplish what others are not: proper pricing strategies, maximum value and quicker sales.
So, how do you find and select an appropriate professional real estate appraiser with expertise in the lakefront market? Let us help! Contact Us for tips on the selection process.
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