What would an upward or lower price adjustment look like based on the current market CMA? Well, let’s look at an example. Let’s say that the CMA of previously and recently sold similar homes shows that the listing price should be around $235,000. However, those sales are between one month and three months old. The current market listing CMA shows that similar homes in the neighborhood are listed at $249,000 or thereabouts. We may decide that the market is improving and justifies raising the listing price of your home to $245,000 so that it’s still competitive but a better deal for you. Of course, this can work the other way as well.
A proper list price that reflects current and realistic market conditions is critical to getting your Middletown and Newark real estate property sold quickly. He doesn’t want you to under–price, but it’s worse to over–price in any market. Buyers discount value by DOM, Days On Market. The longer a home stays on the market, the greater they’ll discount their offers. So, a realistic list price is how he makes sure your property sells without languishing on the market.
How does he come up with a suggested list price that reflects your home’s competitive position? It’s a combination of services and experience, and he’s going to be very careful and detailed in his analysis and market evaluations to make sure that you don’t leave money on the table or sit around wondering why you aren’t getting offers.
Michael’s evaluation of how your property compares to the current competition is the first step. Then he may suggest some worthwhile corrections you can make to improve that position. Once he knows what your home will look like when listed, he’ll go into our thorough CMA, Comparative Market Analysis, process.
CMA of Sold Properties
First he selects comparable properties out of those sold recently and in the neighborhood or nearby. These “comparables” or “comps” are selected based on similarity in features, location and characteristics with your home. They must have been sold as recently as possible so the sold prices are of maximum value. He then does a detailed “adjustment” process to adjust their sold prices for any differences with your property. If a home has one more bedroom than yours, he would adjust that property’s sold price downward for the value of one bedroom to make the comparison “apples to apples.” He makes adjustments for garages, bathrooms and other major features to bring our comps to closely compare with your home. Then he uses those sold prices to arrive at a preliminary listing price for your home. He say “preliminary” because he has another CMA step.
CMA of Current Listings
Now he gets more comps, but instead they’re properties currently listed and your competition. He goes through the same adjustment process, and he comes up with another, possibly higher or lower, price suggestion for your home. This second CMA gives more up–to–date information about the market which could cause us to lower or raise the preliminary list price to adjust to the current market. Using the two CMA results and an experienced analysis of your home’s position in the marketplace, he can set a listing price that will get the job done.