Selling Your Home

SELLING YOUR HOME

During Real Estate Listing Presentations, Heléne and I meet with potential home seller client(s) and help answer these three questions about selling your home.

1.)  HOW MUCH IS MY HOME WORTH?

Obviously, the question of “how much is my home worth?” is going to be a big concern for a potential seller.

Neither Heléne nor I will give you an exact price-point number (that precise number of the LISTING PRICE is up to the you, the seller); rather, we’ll use DATA-DRIVEN ANALYSIS to arrive at an expert opinion about a PRICE-RANGE your home is worth.

That estimated price-range should factor into the LISTING PRICE at which the property ultimately goes on the market.

Our goal is to work with you to list your home at the correct price; to sell it for the most money; in the least amount of time; in the smoothest possible way!

THE MARKET

The REAL ESTATE MARKET is ultimately what drives your home’s value.  SUPPLY & DEMAND is everything.

We’ll use a variety of tools and methods to study the real estate market in your area to understand your home’s value.

THE MLS

Our big tool is The Multiple Listing Service, otherwise known as The MLS.  

The MLS is a database run by local real estate association groups that aggregate all of the real estate listings, both current and sold (or no longer on the market).  It allows us to compare data points and get snapshots of a particular neighborhood’s home values back through time.

ESTABLISH THE NEIGHBORHOOD

The first thing we do is establish the baseline neighborhood that we will use for comparisons.  This is both an art and a science.

Your real estate agent’s personal experience in a neighborhood can be helpful.  Heléne and I, for example, have many years of having lived in L.A.’s beach cities like Marina del Rey, Venice and Playa Vista.  We’ve also spent lots of time in Palm Springs, Palm Desert and environs.  Our newest market is Temecula.  For us, it’s great to have such an on-the-ground “feel” for a neighborhood.

Plus, we use the data we get from the MLS and title reports to understand a neighborhood’s boundaries from a market perspective, while mapping tools like Google Earth give us an excellent picture of a neighborhood’s physical boundaries.

During our Real Estate Listing Presentations, Heléne and I like to use both the personal experience and the technology research aspects in this process.

“PULL THE COMPS!”

Using our neighborhood boundaries within the MLS, we then isolate the “comparables,” otherwise known as “comps.”  These are recently sold properties roughly similar to the subject property (the seller’s home).

Obviously, no two properties are exactly alike, but what we’re looking for are TRUE COMPARABLES – just being near each other doesn’t necessarily mean they’re comparable.

WHAT MAKES A COMPARABLE WHEN SELLING YOUR HOME?

In a neighborhood that is, for example, a subdivision, all the properties might be essentially the same, all built at the same time with the same materials by the same developer.  In this case, we could cast a fairly wide net because the neighborhood will be highly homogenous.

It might seem counter-intuitive, but properties that are different sizes or have different numbers of bed/bathrooms can be comparable.

We use a process to establish how the market has priced out similar situations and arrive at the price valuation the market has given a particular asset in the past, always adjusting the comparable price to the subject price, not the other way around.

For example, we can use price per square foot to adjust for different size homes, or figure out what premium the market has given for an additional bedroom or bathroom.  This process is easier to do in the above example where the homes have a higher element of homogeneity.

At the other end of the spectrum, you have a location like our home territory in VENICE, where structures have been built in a willy-nilly manner through the years, and you might have a four story brand new mansion next to an original one-story bungalow built in the 1920s with a fifth of the square footage.  In this situation, we have to be a little more choosy to compare apples to apples.  We might have to either expand our search area or accept fewer true comps.  (And, in this situation, we would have to consider the LAND VALUE for a knockdown or development.)

Heléne and I will work with you at each step of the way to help you understand the comps.

ARRIVING AT THE LISTING PRICE

This is the big question: knowing what the data shows, at what price would you be comfortable listing your home?  This is your ultimate decision, not ours.

One thing you want to be aware of is AGENTS WHO TELL YOU WHAT YOU WANT TO HEAR about your home’s value.  They will make all sorts of promises to get you to sign the LISTING AGREEMENT, even if they know the proposed listing price is way too high.  This will do you no good – it’s a recipe to have the home sit on the market for a long time, before it will inevitably need to have a PRICE REDUCTION to bring it down to the correct market price.

Talk to Heléne and I about other things to watch out for in choosing a great real estate agent.

2.)  IS NOW THE RIGHT TIME FOR SELLING YOUR HOME?

This question is less about your specific property and more about the residential housing market in your area.  During our first question of Listing Presentations, we have been looking backward in time to come to a conclusion about the present value of the home.

Now the second question we’ll look at what the market is like moving forward and what this means about the decision whether or not to put it on the market at this given price at this particular moment.

INVENTORY

As we noted above, our friends Supply & Demand are a big deal.  In this case, the demand is coming from home buyers and the supply is coming from home sellers.  So understanding the INVENTORY DYNAMIC in the market is a critical step.

What we look at is the the number of homes presently available for sale in a given market (the inventory), divided by by how fast properties sell in a given time period (home sales per month averaged over a particular time period).

Then, you ask how many months it would take for that inventory to be depleted, if no new properties came on the market.

So say there are 50 homes presently on the market, and 10 homes tend to sell every month, you would have five months of inventory.  That takes us to the question of whether or not this is a buyer’s market or a seller’s market.

BUYER’S AND SELLER’S MARKETS

Buyer’s and Seller’s Markets are defined as being about this “numbers of months of inventory” data point.  According to the National Association of Realtors®, six months of supply suggests a period of “moderate price appreciation.”  A reduction of the number of months of inventory, they also noted, tends to drive prices up more quickly.

So essentially, the difference to keep in mind; seller’s markets have less than six months of inventory and buyer’s markets have more than six months of inventory.

DAYS ON MARKET

Days on Market (DOM) is one of my favorite data points (I’m kind of a nerd).  We cover this idea extensively during our Real Estate Listing Presentations.

When a property is listed on the MLS, the DOM are marked like a ticking clock moving inexorably toward that property being sold (or perhaps not being sold).

PROPERTIES THAT ARE PRICED PROPERLY

Homes that are priced properly should sell quickly, and often for above-asking price.  (More about this idea in an upcoming post about PRICING STRATEGIES).

PROPERTIES THAT ARE OVERPRICED

Properties that are overpriced will sell slowly or not at all.

The greater the number of DOM, the greater the chance the property is over-priced.  Demand for that property is not borne out by the Listing Price.

AVERAGE DAYS ON MARKET

Looking at the Average Days on Market (ADOM) in a given area is a good way to judge supply and demand and pricing levels in a given market.

As a market slows down, the ADOM goes up.  By looking back over a period of months, you can track the rise or fall of a market.

PRICE REDUCTIONS OR ADJUSTMENTS ON THE LISTING PRICE

Analyze the recent sold properties – how many of them had to lower their ORIGINAL ASKING PRICE before they got to the SOLD PRICE.

Looking for Price Reductions or Adjustments is a great way to study a market.  Price Reductions (or as they are coyly described as “Price Adjustments”) suggest that a property was overpriced, did not sell, and then had to have its Listing Price lowered to attract buyers.

The best part about this data point is that it gives you a great upper-floor for pricing.  Contact Helene + Bradford or talk to us during a free Real Estate Listing Presentation.

MACRO-ECONOMICS

The breadth of this question is vast and beyond the scope of this humble (but useful!) blog post.  But let’s touch on a couple of points.

INTEREST RATES

Higher interest rates make mortgage payments higher, and as such, tend to have a damping effect on the market.  Sold prices are lower; DOMs are longer; more deals fall through because of loan contingencies.

AFFORDABILITY

The higher the interest rates, as noted above, makes mortgage payments higher on a monthly basis.  The two biggest barriers to homeownership are down payments and the monthly payments.  The higher the prevailing interest rate, the lower affordability a home has, which tends to push its price down.

3.)  WHY SHOULD WE HIRE YOU TO SELL OUR HOME?

Great question!  Let’s take a look at the reasons why you should work with us!

THE POWER OF COLDWELL BANKER REALTY

In California, all licensed real estate salespeople have to work for a brokerage.  Our brokerage is Coldwell Banker Realty.  It’s not only one of the most widely-recognized brands in the world, it’s also a fundamentally different type of brokerage than others out there.

Here’s why: most brokerages out there are privately owned by an individual or a small company, despite what looks like a national brand.  What these small mom-and-pop type businesses do is pay a sort of franchise fee to the national company, in exchange for getting to use the brand name, and perhaps some rudimentary support.

But Coldwell Banker Realty is different.  It’s owned by our parent company Anywhere Advisers (formerly NRT LLC), which is in turn owned by Anywhere Real Estate (formerly Realogy), the nation’s largest residential real estate brokerage.

What does this mean for you?  Plenty.  First of all, Heléne and I have received world-class training from the best in the business, with access to people, tools, and ideas that are simply beyond the reach of smaller brokerages.  Let’s take a quick look at some of the highlights.

SOME REASONS WHY COLDWELL BANKER REALTY IS SO AMAZING

RealVitalize

When you list your home for sale with Heléne and I, you have access to a program called RealVitalize, which allows you to make home improvements to increase your property’s value – with no money up front.  Best of all, their dedicated project consultants manage the renovation process, using Angi’s network of trusted service professionals.  RealVitalize helps your home show its best to potential buyers – and makes it easy for you!  Contact us to find out more.

Listing Concierge

To guarantee industry-leading marketing, Helene and I use a Coldwell Banker Realty program called Listing Concierge, a comprehensive, customizable marketing solution that uses proprietary online tools and white-glove service.  It combines print and online advertising, social media, direct mail marketing and more, to make sure your property gets maximum exposure to buyers and sells for the highest possible price.

The View

Speaking of marketing, one of the great things about Coldwell Banker Realty is its bespoke real estate magazine The View, which is available in both print and online versions.  We place advertisements for our listings in The View, which expands the reach of our marketing far beyond your neighborhood’s boundaries.  Who knows how far away your buyer might come from?

Global Referral Network

The referral possibilities within Coldwell Banker Realty gives us access to leading agents in top markets across the USA and beyond.  So whether you’re moving down the block or across the planet, we can sell your home – and help you find your next one as well.

Service Partners

And one of the greatest advantages for our clients is Coldwell Banker Realty’s service partners, which make us a one-stop shop with all the services you need in one coordinated place.  West Coast Escrow, Equity Title Company, and Guaranteed Rate Affinity mortgage brokers, are top-notch and we have excellent working relationships with each of these companies.  We truly are a full-service brokerage.

WHY HELÉNE + BRADFORD ARE GREAT REALTORS®

Heléne and I really love working in real estate.  We’re dedicated to giving our clients the most professional and ethical service we possibly can.  It matters to us that you are happy with your experience, from start to finish.

We’ve worked with clients in Los Angeles and Riverside Counties, but cover all of Southern California, as we are part of Coldwell Banker Realty’s Southern California Division.

Heléne is a fantastic people-person with a degree in Hospitality Management, and has worked in top hotels in both the United States and Europe.  She’s received a Certified Transaction Coordinator certificate from the California Association of Realtors®, and can guide our clients through the most complicated transactions – making your sale go as smoothly as possible for you.

Bradford has a background in media and marketing, and produces all of our marketing materials (including this blog).  He’s received a First-Time Buyer Specialist certification from the California Association of Realtors®, and has taken courses in a variety of advanced topics most agents never learn, from Appraisals to Finance to Escrow.  He loves working with clients to help them understand the real estate process.

We’d love to meet you for one of our free Listing Presentations so we can discuss how we’ll help you sell your home fast, easy, and for the most money!