YellowFever
New member
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It seems asinine that your home value is based on your neighbors comps
- Thread starter YellowFever
- Start date
NEW -> Contingent Buyer Assistance Program
Because most people are stupid and greedy.
Why do you think USC closes deals so fast? I'm speculating but his homes are never over-priced. They are probably priced at or slightly below comps. He gets good photos, staging etc. and surprise surprise he generally gets multiple offers, does the best and final round and is in escrow within a week or two. then sets a new record for the area.
USC is smart and he gets his clients to listen to his advice because he has example after example of his strategy working.
The strategy of pricing listings at or slightly below comps only works if the market is healthy where there are lots of potential buyers. As you mentioned, I don't believe that would be the best strategy to use for higher end homes due to the thinner buyer pool and potentially not getting enough buyers to bid up the price of the home. I have a step-by-step action plan that the sellers and I execute when I list properties at or slightly below comps, it's a team effort. I do my best work when I have multiple offers on my listing, I'm like a shark with blood in the water. When you have multiple offers, the seller does not have to provide an pricing info to the buyers and information is power. Replying back to buyers with a "best and final" offer puts the pressure back on the buyers providing them little information from the seller. When these buyers get emotional, they often submit higher than normal prices. As I mentioned before, a lot of sellers and agents don't understand the concept of the time = money (think of the cost of a vacant home to the seller). The faster a home closes the better for the seller, simple as that.
usctrojancpa
Well-known member
You are right that the number one thing that the appraiser will focus in on are near by closed comps that happened recently (the more recent the better). That being said, most appraisers on my listings with upgrades did ask when they were installed and ended up adjusting the values up accordingly. Regardless, appraising a property's value is more of an art than a science and can be greatly effected by the individual appraiser that is selected.
Your scenario really comes down to the laws of supply and demand. If the demand/desirability/affordability in a particular neighborhood is constant then the lower turnover of homes in that neighborhood that will translate to more stable prices for those homes.
Your scenario really comes down to the laws of supply and demand. If the demand/desirability/affordability in a particular neighborhood is constant then the lower turnover of homes in that neighborhood that will translate to more stable prices for those homes.
YellowFever
New member
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Ready2Downsize
Well-known member
It doesn't work that way for houses. You have to have at least two bidders who can qualify who want the item at the particular time it's listed. Lower priced homes obviously have a better chance to have the house bid up to fair value since the buyer pool and those looking are from a bigger lot than high priced homes.
If a high end home with a lower pool of buyers is priced too low and a sellers market you may have realtors step in but in my experience they like to lowball the seller, not bid something up to market value.
Even on ebay you need at least two people to bid on any item to get it to fair market value. Popular items it would work on but others you have to search for not so much. I have gotten some awesome deals for postage on ebay because no one else bid and the seller must have thought their item would have been bid higher by the close.
Depending on what the postage happens to be even face is a deal if you know of some place or someone else to sell it to and 60% of face is just stupid crazy money in the bank..... as if someone posted buy this $100 in currency from me for $60 with free shipping and 10% back in ebay bucks knowing I can sell it to someone else for $100-$300 and tack on shipping if they aren't buying it from me in person.
Same could be said for Angels baseball tix to Yankee, Dodger, Red Sox, 4th of July and sometimes opening day games when the angels were a good team. Pick em off the Tix exchange for minimum a season ticket holder could sell them for ($6 plus 10% in the right field pavilion) from season ticket holders who couldn't go and sell them on ebay within an hour for $40. All I had to do was forward the pdf file I just got to the ebay buyer. I knew the "value" of those tickets so I guess they were priced too low on the ticket exchange but amazingly sellers who priced them above $6 had them sit even though they were selling for $40 on ebay at the same time they were selling their tickets.
I also bought a ton of tickets from brokers for $5 (a buck under the price they paid for games in which bobbleheads or other stadium giveaways I deemed would sell on ebay well and waited till the game sold out and then sold the tickets for $20 on ebay knowing any I had left I could go thru the turnstiles and collect bobbleheads, sell those for at least $25, add in shipping and use the postage I got on ebay to send them out. I always stayed to watch the game but I know I wasn't alone in that little money maker deal from others who weren't even baseball fans and left with their bobbleheads in tow.
Those were the days........ too bad the Angels aren't any good any more. Here's hoping this year will be an improvement for that team.
If a high end home with a lower pool of buyers is priced too low and a sellers market you may have realtors step in but in my experience they like to lowball the seller, not bid something up to market value.
Even on ebay you need at least two people to bid on any item to get it to fair market value. Popular items it would work on but others you have to search for not so much. I have gotten some awesome deals for postage on ebay because no one else bid and the seller must have thought their item would have been bid higher by the close.
Depending on what the postage happens to be even face is a deal if you know of some place or someone else to sell it to and 60% of face is just stupid crazy money in the bank..... as if someone posted buy this $100 in currency from me for $60 with free shipping and 10% back in ebay bucks knowing I can sell it to someone else for $100-$300 and tack on shipping if they aren't buying it from me in person.
Same could be said for Angels baseball tix to Yankee, Dodger, Red Sox, 4th of July and sometimes opening day games when the angels were a good team. Pick em off the Tix exchange for minimum a season ticket holder could sell them for ($6 plus 10% in the right field pavilion) from season ticket holders who couldn't go and sell them on ebay within an hour for $40. All I had to do was forward the pdf file I just got to the ebay buyer. I knew the "value" of those tickets so I guess they were priced too low on the ticket exchange but amazingly sellers who priced them above $6 had them sit even though they were selling for $40 on ebay at the same time they were selling their tickets.
I also bought a ton of tickets from brokers for $5 (a buck under the price they paid for games in which bobbleheads or other stadium giveaways I deemed would sell on ebay well and waited till the game sold out and then sold the tickets for $20 on ebay knowing any I had left I could go thru the turnstiles and collect bobbleheads, sell those for at least $25, add in shipping and use the postage I got on ebay to send them out. I always stayed to watch the game but I know I wasn't alone in that little money maker deal from others who weren't even baseball fans and left with their bobbleheads in tow.
Those were the days........ too bad the Angels aren't any good any more. Here's hoping this year will be an improvement for that team.
qwerty
Well-known member
BangBros said:
Because most people are stupid and greedy.
Why do you think USC closes deals so fast? I'm speculating but his homes are never over-priced. They are probably priced at or slightly below comps. He gets good photos, staging etc. and surprise surprise he generally gets multiple offers, does the best and final round and is in escrow within a week or two. then sets a new record for the area.
USC is smart and he gets his clients to listen to his advice because he has example after example of his strategy working.
qwerty
Well-known member
In the accounting world, the best indicator of fair value is when there are actively traded prices such as the New York stock exchange. In real estate, the equivalent is comps which like anything else is determined by supply and demand.
If one sells their house and only gets one offer and the seller doesn't think it's fair market value they don't have to sell the home, but the market has spoken. The reason for the low demand could be a WtF asking price, interest rates, shitty job market, etc.
Right now we still seem to be a sellers market. Listen to USC and your house will be in escrow in two weeks. be greedy and/or listen to a realrard and your house will sit on the market
If one sells their house and only gets one offer and the seller doesn't think it's fair market value they don't have to sell the home, but the market has spoken. The reason for the low demand could be a WtF asking price, interest rates, shitty job market, etc.
Right now we still seem to be a sellers market. Listen to USC and your house will be in escrow in two weeks. be greedy and/or listen to a realrard and your house will sit on the market
Ready2Downsize
Well-known member
It works for him because he's in a market with high demand and at a price point that has a lot of buyers and because it looks like he's just plain good at what he does. Other realtors might just tell the seller to take the first offer and never see any bidding competition develop to up the selling price.
New homes the same thing.......... lower priced homes in Irvine do well but as you go up the ladder in price there is a smaller buyer pool. There are less comparable comps and you can see wtf priced homes sell once in a while because there is less to choose from and those with lots of money can suck it up and come up with the money with a seller that is determined to sit. Meanwhile overall it looks like to me the upper end has softened and I don't think USC's method would work as well for high end homes.
New homes the same thing.......... lower priced homes in Irvine do well but as you go up the ladder in price there is a smaller buyer pool. There are less comparable comps and you can see wtf priced homes sell once in a while because there is less to choose from and those with lots of money can suck it up and come up with the money with a seller that is determined to sit. Meanwhile overall it looks like to me the upper end has softened and I don't think USC's method would work as well for high end homes.
usctrojancpa
Well-known member
Ready2Downsize said:
The strategy of pricing listings at or slightly below comps only works if the market is healthy where there are lots of potential buyers. As you mentioned, I don't believe that would be the best strategy to use for higher end homes due to the thinner buyer pool and potentially not getting enough buyers to bid up the price of the home. I have a step-by-step action plan that the sellers and I execute when I list properties at or slightly below comps, it's a team effort. I do my best work when I have multiple offers on my listing, I'm like a shark with blood in the water. When you have multiple offers, the seller does not have to provide an pricing info to the buyers and information is power. Replying back to buyers with a "best and final" offer puts the pressure back on the buyers providing them little information from the seller. When these buyers get emotional, they often submit higher than normal prices. As I mentioned before, a lot of sellers and agents don't understand the concept of the time = money (think of the cost of a vacant home to the seller). The faster a home closes the better for the seller, simple as that.