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Don't stop at the appraisal

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Michael Reilly

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Junior Member
Joined
Jan 15, 2002
I want some of what Bob is smoking. How many times do we see inflated listings created by R.E. agents just to get the listing only to see them drop until the seller screams. I guess he can take this position in this market climate but I think he should say that because it wont always be this way and it is misleading.

Don't stop at the appraisal
How to learn your home's market value
Thursday, October 03, 2002

By Robert J. Bruss
Inman News Features




Now that your home is ready for sale after you made modest fix-up improvements, it's time to determine its true market value so you don't get ripped-off by selling for less than you should receive.

(Part three of a six-part series. See parts 1 and 2.)

1. DON'T RELY ON A PROFESSIONAL APPRAISER. If you want to hire a professional appraiser at a cost of around $300 (more for larger houses), be my guest. But please don't rely on the appraisal alone when setting your home's asking price.

The reason is most residential appraisers are not in touch with the current home marketplace. They work from recorded home sales prices, which often lag today's home sales by one to three months. Especially in a rising or falling home sales market, a professional appraisal can be too low or too high by thousands of dollars.

A major mistake many do-it-yourself "for sale by owner" home sellers make is to hire a professional appraiser and set their asking price based on that appraisal alone. The unhappy result is that sellers who rely on such an appraisal might be costing themselves thousands of profit dollars.

2. HAVE FUN WITH INTERNET HOME APPRAISALS. There are several Web sites, such as www.homegain.com, where homeowners can get free valuations of their homes; although their purpose is not to determine the true market value of residences. Yes, it's fun to input your home's data and see what valuation the computer gives to your residence. However, please don't rely on the computer to inform you accurately of your home's probable sales price—it can't possibly consider all the pros and cons of your home, as compared with recent sales prices of similar nearby residences.

The purpose of Homegain is to match home sellers (and buyers) with nearby real estate agents. It's a great place to find a real estate agent in your area. Submit your home information and you'll receive "bids" on listing your home for sale from various realty agents in your vicinity. But don't worry that you'll be bombarded with realty agents hounding you. After you receive responses from realty agents who are given only general information about your home and its location, then you decide if you like what they tell you about their backgrounds and whether you want to contact them.

3. INTERVIEW AT LEAST THREE SUCCESSFUL REALTY AGENTS WHO SELL HOMES IN YOUR VICINITY. A far better approach to determining the current market value is to interview at least three realty agents who sell residences near yours—perhaps agents you contacted through Homegain—or realty agents who send you monthly newsletters about real estate activity in your community. Friends, relatives and business associates are also good sources for selecting agents to interview. But be wary of brand new agents—let them gain their experience from other home sellers.

Even if you think you might want to sell your home without a professional agent, you should at least go through the agent interview process. The agents won't mind. The reason is smart agents know most do-it-yourself home sellers end up listing their homes with one of the agents they interviewed within 30 to 60 days of their own first attempts.

The famous real estate brokerage names, such as Coldwell Banker, Prudential, Century 21 and others mean nothing. What matters most is the success record of the individual agent who gets your listing, whether he or she works for a franchised brokerage, a local independent company or is a "bedroom broker" working out of their home.

Of course, never sign a listing for longer than 90 days—unless the agent includes a written clause allowing you to cancel the listing after 90 days without specifying any reason. Some agents attempt to intimidate home sellers into signing six-month listings—don't fall for that trick. A 90-day listing is the best way to assure your agent will work hard, smart and fast to get your listing sold. The biggest drawback of a six-month listing is the agent tends to get lazy, knowing the probability is your home will sell within six months even if the agent does nothing. Time is money when it comes to selling your home. Once you've made the decision to sell, the longer you own your home, the more dollars it costs you out of your pocket.

As an investor in single-family rental houses, I've worked with dozens of realty agents. A very few qualify as outstanding. Most are very good. A few were duds. The one trait of the best agents is they make things happen, rather than waiting for events to occur. That means the best agents aggressively market their listings. At a minimum, expect your listing agent to use the local multiple listing service (MLS)—the agent's most powerful marketing device because it notifies all local members that your home is for sale. Also, expect your agent to run weekly newspaper ads for your home (with an open house at least once a month) and to put your listing on the nationwide Web site www.realtor.com, as well as the agent's personal Web site. Today, at least 50 percent of home buyers start their searches on the Internet so your listing needs to be there. Check each agent's current listings to see how they are presented to tech-savvy Internet home buyers.

Each agent you interview should, after inspecting your home, give you a listing presentation not longer than 30 minutes. If an agent can't get his or her message across in that time, maybe that's not the right agent for you—unless you interrupt a lot. However, don't be pressured into signing a listing on the first visit. Before you even ask, the best agents will give you references of their recent home sellers so that you can phone (after the agent leaves) to ask "Were you in any way unhappy with your agent and would you list your home again with the same agent?"

(Part three of a six-part series. See parts 1 and 2.)


(For more information on Bob Bruss publications, visit his
Real Estate Center).


***


Send a Letter to the Editor for publication.
 

Jeff Horton

Senior Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
Alabama
He is either a Realtor or had a deal fall through because of an appraiser.

Man, what an ignorant statement!!
 

jtrotta

Senior Member
Joined
Jan 16, 2002
R.J.Bruss

has been around forever, his articles used to be in the Real Estate news letter until the internet ( or intranet) came about. He's got to be about 90 by now, always had positive/negative comments about everyone and everything, so he could remain neutral; sort of like (astrological sign BS).

8)
 

BarbaraNJ

Member
Joined
Jan 15, 2002
Professional Status
Certified Residential Appraiser
State
New Jersey
While my first reaction is to absolutely agree with jtrotta and atc, I need to take a moment to rebut the article.

I have indicated my displeasure with Bruss opinions before, and it is apparent he has some sort of bias. I also wonder what his interest is, if any, in Homegain since he mentions it specifically and no other website.

I have performed many private appraisals for individuals who want to sell their home privately. Not only do I give them the appraised value, but I also include three or more CURRENT LISTINGS to give them an idea as to the range of asking prices in the area. I advise them that the appraisal is likely the best indicator of the "bottom line" of what they should realize from the sale.

Not only have I never received any complaints, I have gotten referrals from satisfied customers.

Finally, I can give Bruss the name and telephone number of an elderly gentlemen who was determined NOT to speak to or use a realtor but wanted to make sure he was selling his home at the right price. The value I gave him was $50,000 above what he was going to ask. (The last time he checked prices was 3-5 years ago) In his 80's, this was the money he was going to use to enter an assisted care facility. He went under contract in less than a week asking what I advised him, and wound up accepting what the appraised value was. He called me to thank me, and every other phrase from him was "God Bless You".


Hundreds of bank appraisals done this year and this is the one I remember. Makes me proud to be an appraiser, despite Bob's comments.
 
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