The top priority and first thing on the focus list is to define your property value and its price.
Home price evaluation requires gathering tremendous data and information. This includes review of all current and similar real estate trend.
- Comparable Market Analysis (CMA)
One tool to review how much your property worth, is to do comparison analysis. This is a most used and common base in rea estate, used for buyer and sellers to determine the price. This comparison is important since it needs to be in the very same neighborhood and must be a similar type of home, year built, number of rooms, square footage, layout and most of all in needs to be in a same date period of a current and exact similar real estate market and trends.
Yes. Finding a house or a condo for sale in Vancouver with our shifted market in the last past 90 days with exact similar criteria to compare and come p with price is not easy. So that’s where your Vancouver Realtor starts the calculation. Knowing the dollar value to add and deduct any of the criteria missing or extra is the key.
For instance, if a house has more square footage but everything else is the same then, we must deduct the square foot dollar, this is the same with number of bedrooms and bathroom as it goes.
What if there is no comparable nearby sold?
This is common specially coming off a very slow market and or in suburban areas where there are very few transactions. In this case, the Realtor must locate a similar property in another area and analyze the real estate market of that property in comparison to the subject home for sale. And then do the math with adding and subtracting the evaluation.
- Sales Ratio
Sales Ratio is another important tool and data to review when a homeowner is planning to sell their Vancouver Property and wondering how much is their home worth. This informative data provides the percentage of the buyers in regards to the price based on the number of home sold in a very specific area.
For instance, A condo for sale in Yaletown in month of August has 24% sale ratio. In general, anything above 20% indicates higher activity and seller falls under seller market. 15%-20% is a balanced market and under 15% is an indication for a buyer’s market.
This is a great tool to understand the region and exact sub-market of the Vancouver subject property for sale’s activity and the market.
This data goes further and provides price range with sale ratio. This is a great tool. For example, if 1-bedroom condo in Yaletown falls under the range of $590,000 to $610,000 in month of August, after reviewing this data, a smart move for a home seller is to price it under $600,000 since it jumps from 42% sale ratio (Buyer attraction) to 117%. This is a very important move since the seller will increase their home attraction and target to 2.5 increased interest.
- Home Price Indexing (HPI)
Another great tool to analyze the sub-area and neighborhood percentage of growth since the last purchase. Since this tool provides an overall percentage, and doesn’t separate brand new development from an older one and or doesn’t separate other criteria, it is a very general way of approach, but a great tool to understand the trend of the real estate market growth and behavior in graphics.
- Average and Median Price
Every tool is a great way of adding to the knowledge of a home seller and reviewing the average and median price range of a sold homes in the same market trend is a great way of approach. The average price sold is calculation of the price of all home in the same sub-area and dividing the total amount by the number of houses.
Median is the middle number dollar value of the homes sold in the same area.
- Dollar Per Square Footage
Although dollar per square footage only works for two very similar properties in a very similar street, it is yet a great tool of understanding the value that each square footage provides. The square footage is the finished and livable measurement of the property and does not include unfinished measurement with are balconies, patio, parking, and or attic. The dollar per square footage is great for pricing condo and apartment since they mostly have same structure, in the same complex. But yet direction of the unit, views, layout, and floor level needs to be fully considered and price should reflect all and any of it.
- Average days on the Market
The number of days on the market is a great tool for setting expectation. Although each and every property is different and the niche market varies, but it is a good tool for seller to set their expectation and foresee the unseen.
In addition to all these tools above, it is important to have a full discussion with your Vancouver Realtor in regards to any updates, money spent, damages, claims, history and everything that can be a potential factor to affect the price. This also includes the motivation and the seller of why they are selling their Vancouver property and its urgency.
As a local Vancouver Realtor I provide a tool kit and platform for metro Vancouver home sellers to find their home evaluation and see how much their home worth today.