new home vs. couple year old home

[Tim Schneider]

There is a large subdivision in my area (500+ house) where the homes are sold with minimal finishing. The walls are just primed, no lawn or landscaping, outside trim not painted, etc. It seems that homes that are 1-3 years old are selling for more than new homes, because the owners have completed these items. Have others seen this? When comparing to a new home, do you make a positive adjustment for age, and then another negative adjustment to cover the "completedness" or just make a negative age adjustment?

 

[robby3r]

Tim, greetings.

Your adjustments should be based upon Market Influence, which should be discernible in such a large and (presumably) conforming development. Example: perform matched pair-analysis to derive influences for individual features. Can take a bit of extra time, but is worth while to have completed one to validate this otherwise illogical pricing circumstance.

 

[Lee Lansford]

There is a large subdivision in my area (500+ house) where the homes are sold with minimal finishing. The walls are just primed, no lawn or landscaping, outside trim not painted, etc. It seems that homes that are 1-3 years old are selling for more than new homes, because the owners have completed these items. Have others seen this? When comparing to a new home, do you make a positive adjustment for age, and then another negative adjustment to cover the "completedness" or just make a negative age adjustment?

Whatever you do..."explain, explain, explain".

 

[Tim Schneider]

Robby, welcome to the forum, and thanks.

 

[Lloyd Bonafide]

Possibly some adjustments for landscaping, patio, decks, etc. is in order for the resale home.

 

[Kevin Keck]

I think if I encounter a situation similar to yours I would be inclined to make quality of construction adjustment for those homes sold incomplete. I wouldn't adjust a home downward under age for being new construction.

 

[Mike Boyd]

Possibly some adjustments for landscaping, patio, decks, etc. is in order for the resale home.

And, painting as well as anything else not completed by the builder. You need to be more observant than with a regular, completed house. They can add up to a sizeable amount.

 

[Tim Schneider]

The more I think about it, it is not a function of age, but of added items. The -'s for add ons just outweigh the +'s for age.

 

[xm2841]

I would go condition adjustment and age, then explain everything. Quality of construction seems not right because Im under the impression they are all sold the same way. The resales are selling for more because the condition is better (they are finished). I would adjust for age, making new properties superior having never been lived in, and condition of older properties superior having been completed. Whats more appealing in the market, a new one or the one thats 100% finished.... thats where I would get my adjustment (matched paired sales).

-JW