How is the value of your property calculated?
One of the most pressing issues that prospective home sellers face is establishing the price of their property. Choosing an asking price for your property does not necessarily mean that it will fetch that specific price, but it is important to establish an amount that helps you to make a profit on your initial purchase, whilst still being realistic in the current market conditions.
Trustworthy and experienced real estate agents are invaluable in this process. When determining the value of a property, real estate agents perform a comparative market analysis. If you aren’t familiar with the term, a comparative market analysis, or CMA, is an in-depth evaluation of comparable homes (“comps”) that have been sold in the past 6 to 12 months.
First of all, a CMA will not only take into account the features and size of your property, but will also consider the suburb and local area, and the homes surrounding it. Real estate agents will also take note of the school district – of which there might be several in a town or suburb – in which a home is situated, and the comparable properties within that specific school district.
In terms of your property, a comparative market analysis looks at the interior features, exterior features, mechanics, yard features and location, and the style of the residence.
Real estate agents will typically look at things like:
• the number of bedrooms
• the amount of square metres of the house
• the kitchen
• the amount of bathrooms
• the flooring
In this respect, real estate agents will consider:
• the roof
• garages or parking spaces
• decks and patios
This refers to a home’s heating and/or cooling system, and the age, model and make thereof, as well as the electrical service and hot water heater. It goes without saying that a house with a water heater that is 20 years old and only functions at 80% of its capacity will be worth less than a home with a water heater that is a year old and still functions optimally.
Yard features and location
The features of a property’s yard refer to the floor area of the property in square meters, and also sometimes the property’s location on the street. This is not always the case, but sometimes corner properties are worth a little less than properties elsewhere in a street.
The style of the residence
It goes without saying that the style of the house is important, especially when it comes to comparable properties in the vicinity.
A comparative market analysis does not guarantee what a home will sell for, but when it is done by a professional real estate agent that has extensive local market knowledge, it does tend to give you a greater indication of what you can expect when selling your home, which is why it is of paramount importance to use experienced real estate agents to help you sell your property.
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