Today’s Buyer

Fact: 1.2% of properties SOLD—resulted because of an Open House visit
Source:  National Association of Realtors® & Scott Einbeinder Seminars

Today’s home buyer is highly sophisticated armed with a wealth of information on the internet about home sales activity.  A significant percentage of home buyers are now represented by a Buyer’s Agent; held accountable to conduct due diligence and analysis for fair market price.

Current Market Trend:  Buyer Representation

Massachusetts Agency Relationship law changes effective July, 2005 resulted in a surge of Buyer Agents representing the best interests of buyers, not sellers.  What changed?  Previously “sub-agents” worked with buyers—agents who indirectly represented sellers and their asking prices. Buyer Agents are held accountable to conduct due diligence and analysis for fair market price; resulting in sale prices being challenged more than ever before.

Current Market Trend:  Mortgage Financing & Appraisal Guidelines

Stringent credit score requirements, tougher Condominium Association guidelines and the “HVCC” – Home Vale Code of Conduct – implemented in 2009 created more barriers to financing for home buyers and especially for Condominiums than ever before.  Appraisal practices are under a microscope resulting in under-market valuations and some local markets in the Boston area negatively impacted by foreclosure and short sale activity.  Property address and location makes a difference; as we have seen some neighborhoods fare better than others within the same city, town and/or zip code.

Pricing for the current market requires careful consideration of the anticipated appraisal value home buyers will receive when seeking financing.  As a Listing Agent we must think more like an Appraiser and measure fair market using similar methodologies.  We also know Appraisers measure comparable sold statistics from the last 90 days – preferred.  If no comparable data is available within the last 90 days, then the range of time is increased by 30 additional days prior to obtain ample data and as few as 3 previously sold properties may suffice.

Fair Market Value

Factors that DO impact property value:

• Location, living area size, number of bedrooms & bath, parking, curb appeal
• Current market conditions (within last 90 days or less)
• Current inventory available & comparable properties in the same neighborhood
• Average appreciation rate for properties resold within last 5-7 years

Factors that DO NOT impact property value are:

• The price Seller originally paid for the property
• Expectation of a dollar-for-dollar return (100%) on investment for improvements in short and long term; using regional averages published by Remodel Magazine www.remodel.com are very helpful.