Common mistakes when putting a house up for sale in today’s real estate market

This is the first in a series on this topic. Today we will focus on the method agents use to determine listing prices in today’s California market.

How can I be sure? Some homeowners in today’s California market can’t help but think they are “giving away the farm.” How do I know for sure that the agent I signed up with today was not looking for a quick sale? I know sales are slow, are you cheating me with this list price to sell faster? The house down the street sold for more and my house is so much better than theirs!

Why do different agents have different list prices? The agent I met earlier in the week said they could sell it for more. Who has the reason? Should I list at the highest quoted list price and trade lower? That’s what everyone else does, right? Is that the best strategy in this market?

These are the stubborn questions, doubts, and fears we all face when listing our homes for sale on this market. Unfortunately there are no guarantees. Most real estate agents are hard-working, ethical professionals, but it’s these few that ruin the rest of them. These few are the ones we listen to, and generally an entire industry as a result.

How can I increase the chances of feeling confident that the agent I sign up with knows what they’re doing and cares about me? We are going to focus specifically on the main tool that will have the most influence other than “Experience” on how an agent determines the listing price or “sale price” of your home. This tool is the “Comparative Market Analysis” or commonly known in the industry by the acronym “CMA”.

What are the common mistakes that inexperienced agents encounter within the CMA when using this valuable tool?

Do not filter REO sales “Real Estate Property” or bank-owned properties that are not “arm’s length transactions”

By using these sales, you can unintentionally “skew” the values ​​downward in many cases. These sales should only be included if they are the predominant sales in the market area.

Do not use sales within the same zone or proximity to the house that is listed for sale.

Sales outside of the immediate area or stretch to support the overpriced sale.

Do not emphasize current sales prices and pending sales as the best indicators of current market conditions.

Taking an overpriced listing based on closed sales that are older and reflective of the market at that time in some cases up to 6 months or more.

How do I know if REO properties or bank ownership were used in the CMA analysis?

o Ask your agent if they filtered these types of sales or listings out of their CMA analysis. (Remember the saying “garbage in, garbage out”)

o Stop by the addresses of the houses listed in the CMA, many will indicate “owned by the bank” on the for sale sign.

o Check public records online, ask a local title company to verify the property, or ask a local appraiser who is cooperative. (Remember those who helped and refer them to businesses)

What are you looking for or asking to determine ownership of these sold homes listed on the CMA? Ask who is the current owner of the mentioned house. If it is the name of a bank, then the house is owned by the bank and, in most cases, is not comparable property.

As you can see, it is vital that the data included in the Comparative Market Analysis is consistent and reflects current market conditions in your area. Using an experienced agent who takes all of the above into account to determine the “sale price” will provide the “peace of mind” that all bases have been covered. Listen to this professional and follow his advice. You now have the tools and know what to look for within the CMA presented to you by your real estate professional. Good luck selling your home!