What’s happening to home sellers in the Birmingham, Alabama market?

I am the biggest proponent of getting an appraisal for home owners wanting to sell.  You might say “of course you are, you’re an appraiser”, but guess what?, the word is getting out!  I say this because I have performed more “pre-listing” appraisals recently than normal.

I think this is a good sign that homeowners are beginning to realize that if they want to sell, they must be more realistic with what they price their home at.  If you look at statistics you will see that when a home that is priced more realistically sells, it sells in a shorter time period.  A home that is priced correctly will have a high sale price to list price ratio, meaning that the final sales price was very close to the list price.  In addition to that statistic, the percentage of actual sales to listings will be higher.  It has been very hard for owners to accept the price at which they must now list their home at because it is much lower than it was years ago and we are not use to this because we have always been told that real estate does not lose its value.  They have listed their homes at a higher price only to have to reduce it multiple times to get it sold.

Buyers these days know what other homes are selling for and if they come across a home that is priced too high they will go on to the next one in the neighborhood that is priced more accurately.  Declining markets are still prevalent in many areas and if your home is left on the market for a longer period of time buyers see this, and they will perceive you as being desperate, and this will encourages them to make lower offers.  In a recent study by RadarLogic they reported that:

“Sales of non distressed properties increased last year, but that increase was accompanied by a decline in prices — lowering the price spread between distressed and non distressed sales, the report said.”

Take a look at this graph that accompanied the article.  You will see that while the number of sales increased the prices decreased.Real Estate Sales up-Prices Down

So you are probably asking what this means for you, the average home seller, right?  As a real estate appraiser my advice would be to make sure you have your home priced as accurately as possible.  This can be done by you, a real estate agent, or an appraiser.  I recently wrote an article about “How To Estimate The Value Of Your Home Without Getting An Appraisal”.  It will give you tips on pricing your home correctly.  You can also hire a Realtor to sell your home, but make sure they know the market you are in and are in tune with prices and what it takes to sell.  I know several I would recommend, so give me a call if you need a name. The last option would be to get an appraisal.  By doing this you will know what the home is really worth and what the bank will finance so there will be no surprises.  The bottom line is that you will have a better chance of selling your home if it is priced competitively for your area rather than on emotion or poor knowledge of the local real estate market.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on Facebook., Twitter, or Youtube.

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