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WHAT IS MY HOME WORTH
Max Mendoza & Laurence Nathanson
Max Mendoza is both a Realtor and an Appraiser with over 20 years experience in the Bay Area.
He can be reached at Access Homes, 415-271-9784, or email@example.com
The following article appeared in the January 2013 edition of the Castro Courier.
If you have a home in an area served by the Castro Courier and have lived in it through the market downturn, you have been fortunate enough to have avoided the plunge in home values that has afflicted most of the rest of the country. But whether you are considering selling it now, in several years time, or sometime in between, the key question in the back of your mind is probably: “How much could I get for my home if and when I decide to sell it?”
Earlier this year, we had a listing where our clients had lived in their home for 40 years, the last 15 of which were spent with two cats and no litter boxes! As you can imagine, the hardwood floor and carpeting were indescribably bad and everything else in the property dated back to when it was first built in 1949. Our initial valuation was at $395,000. Our clients only had a budget of $5,000 for improvements, so we really needed to be creative! Being in the market for over 20 years and knowing what items create a greater return in value, we were able to use this budget to transform the property from an ugly duckling into a beautiful swan. This resulted in 12 offers all above the asking price, with the highest offer coming in at $510,000 -- $115,000 over the initial valuation! This shows that even on a small budget, it is possible to raise a home’s value substantially by spending on things that matter most to potential buyers.
There are many factors that go into valuing a home, but the key parameter is estimating how much someone will pay for it based on the features specific to your home, the price of other homes currently on the market, or similar homes in the area that have sold within the past six months. When a certified Appraiser looks at a home, he or she first takes measurements, then snaps photos, and finally completes a detailed analysis that includes the overall condition, improvements, location, and other factors that are pertinent in determining a home’s value.
Once this summary is complete, the next step is to search for comparable properties (or “Comps” as they are know in the industry). Appraisers use specialized guidelines in order to determine which Comps they can use. Each comparable is analyzed on a feature by feature basis relative to the features in the subject property and given a value. For example, if your home had an updated kitchen versus a comparable that did not, this would justify a higher market value for your home – given that everything else is equal. After completing the analysis with three comparable closed sales, the appraiser is then able to come up with an estimated value for a property.
Timing for placing a home on the market can be a big factor in achieving maximum value. Like everything else, supply and demand for homes can add tens or hundreds of thousands of dollars to the final sales price. Typically, the months between October and February are a slower period for home sales as buyers focus more on the holidays than looking for a home. However, with interest rates at an all-time low, this year has been an anomaly with 95 homes sold in the October through December time period in Real Estate Zone 5 (which encompasses: Glen Park, Noe Valley, Eureka Valley/Dolores Heights, Corona Heights, Clarendon Heights, Twin Peaks, Buena Vista/Ashbury Heights, Cole Valley/Parnassus Heights, Height Ashbury, Duboce Triangle, and Mission Dolores). This sales rate represents an increase of over 3% compared with the same period a year ago. In addition to this, because there are currently more buyers than sellers, this has often resulted in multiple offers exceeding a property’s listing price.
Aside from fixed factors like location, lot size, and view, there are many cosmetic and structural changes that you can do to increase the value of your home. The best thing you can do to gain value in your home is to update your kitchen and/or your bathroom(s). The kitchen is usually the gathering place at a house party and homebuyers gravitate to this room as well. In addition, with the amount of time that most of us spend in the bathroom, updates to this or these rooms also add great value for potential homebuyers. Money spent for either of these updates will usually be recouped in a sale and generate a higher overall price.
If you would like to get a FREE market analysis of your home or want to know specific things you can do to increase its value, contact us NOW through the AccessHomesNow.com website, phone, or email listed below.
Max Mendoza and his partner Laurence Nathanson, both of Access Homes, help homeowners maximize the value of their home before selling it, and help buyers find homes that have built in equity or great potential for appreciation. They live in Corona Heights and are very familiar with neighborhood valuations as well as those for other areas around the city and Bay.
Max Mendoza [DRE 01184991]