Marketing your home in today’s market.

The Upstate of South Carolina is currently (as of Jan 2010) mixed with showing average price up with the median price down with the days on market up slightly. Expect a detailed update to this information soon.

Using median or average historical sales in any sampling can be problematic in any market. The reasons are many but primarily if one conducts such a study without regard as to the methods and reasons for the sales a gross miscalculation of property value can occur as well as skewing the expected days on market. Because some Internet based property evaluation sites are totally automated and use only tax sales records available to the public these sites are prone to producing erroneous values.  We need to ensure apple to apple comparisons are being used.

Foreclosures have been known to sell for 50% or even less than market value. For banks these homes are dead weight. In the case of a VA or FHA backed loan the majority of each loan is insured by the federal government; which is one of the reasons real estate is suffering so much now. (Many lenders have made loans knowing the probability of foreclosure was high but since the majority was insured they only stood to lose the difference.)

Some foreclosed homes are trashed by irate owners being forced out. Some are just in disrepair. Others are just hard to sell and after waiting for a suitable, qualified buyer to come along the owner (read bank) will just start to slash the price until it sells. Any of these causes could result in an unfair comparable if used to find the most probable selling point for your house; or if trying to determine whether a potential buy will appraise for the asking price.

Using a knowledgeable Realtor is essential in this market, regardless of which side of the transaction you are on. While I build Comparable Market Analyses almost daily and do it for free as a service to draw potential clients, it's still a pretty good idea to go ahead and get an appraisal. Only a licensed appraiser can legally perform an appraisal. The appraiser will look at much of the same information as me. However, they go into much more detail. In today’s market it helps greatly when marketing a home to start out armed with an appraisal to justify the asking price.

One more thing to consider is that real estate is always local. Even though the market in general may be off marginally, it may actually still be up in your particular area. If you live or wish to live in some of the Upstate’s most popular neighborhoods or areas values may still show an increase. You won’t know if you don’t ask.  

Finally, selling in the off-season can exaggerate the marketing issues. Generally speaking, the off season is while school is in session. The market starts to heat up about two months prior to the summer break. If you need to sell your home you need to be prepared for a long ride. You will need to establish the right target price with a margin for negotiation and then stick with it. This advice is for normal sales and not the desperate. If you are in danger of foreclosure or considering a short sale be very careful. Talk to your lender. Banks don't need any more foreclosed homes in their portfolio. Many will work with you to help negotiate conditions you can live with or at least minimize collateral damage to your credit history.   

An insightful article. Click here to read.