How Much Is My Tallahassee, FL Home Worth?
Determining a price when selling a home warrants careful evaluation and knowledge of market conditions. Today I met with sellers who paid a premium for a second home in Tallahassee in 2006. Today they are considering selling, as they plan for their future retirement. They live in another State, and are likely to retire in South Florida. So at our seller’s consultation we discussed the following:
- Reasons for Selling (Which I just explained above)
- Timeline for Selling (No rush, they are enjoying having the home for now and being close to their child, but making plans to build on a lot in South Florida)
- Market Conditions ( for this home, 6 months ago, there was 9 months of inventory, today there is 31 months.)
- Pricing (Again, they bought at the height of the market. Since then, our area has had a 25% reduction in value across this neighborhood)
- 20% was placed as a downpayment on the property. Market value today is 25% less than what you paid for the home. Taxes are based on non-resident, non-homesteaded value. There are maintenance, and mortgage costs of approximately $21,000 per year. Time spent in the home is approximately 2 months of the year. That’s $10,500 per month. Is this a good use of your money?
- Your timeline is no rush, but maybe it would help to think of comparing the cost of owning this home to renting a home or small apartment for the 2 months out of the year that you are in town. Rent for 2 months, fully furnished 2 Bedroom 2 Bath apartment costs approximately $3000. That’s an annual savings of $18,000. Secondly, we are coming into a selling season, this is when buyer’s are looking, this is when your best chances for a sale are in this area. Waiting will only decrease your exposure to the number of buyers that are looking.
- Market Conditions presently and historically indicate more inventory will come into the market in the Spring and summer months. Pricing and home conditions are the driving forces for sales today. Secondly, there simply are not enough buyers to keep values growing at this time, nor in the foreseeable future. Capturing a buyer today means, price it right, make it shine. Period.
- Pricing: As mentioned, we have had a 20% reduction in sales, there goes your 20% deposit you placed on the property. The improvements you made to correct a drainage issue (which likely should have been addressed when the property was purchased), are likely not to be recovered. What making these major repairs will do, however, is keep a buyer in the game, because they would most likely not have that cash money to fix the issue, nor the experience to know how to address a major issue such as this. They would simply walk away. (A topic for another day, would be how Realtors help hold transactions together by providing or arranging quotes on repairs, or remodels that would work for their customers.)
Is it the right time to sell? If you are realistic about home prices and market conditions, then, yes. This discussion, although hard to swallow, was frank, factual and forthright. There is no other way to discuss listings today. Holding a seller hostage by overpricing a listing is neither an ethical or professional service that any Realtor should represent. Most seller’s are appreciative of the facts, and the ones who are not will interview enough agents until someone tells them what they want to hear. Unfortunately, great Realtors will be picking up the pieces at the end of those listing terms.
As I am writing this post, another agent is telling me the story of her transaction today. A Buyer made an offer on the home and the appraisal is $20,000 lower than the contract price. The selling agent admits he let the seller set the price on the listing. How does that make him look now? Was it fair for the selling agent to take the listing at an overpriced amount? Who won here?
If you want an honest, ethical, professional opinion on the value of your home by a Realtor who knows the facts on pricing, market condition, timing for the sale of your Tallahassee, FL home, then call on our team. Together, we will accomplish your goals and design a marketing plan suitable for selling your Tallahassee, Florida home. Click here for a FREE Selling Guide.
Other considerations might be, hold the property and lease it. Treat it as a long term investment, (which unless you can afford to walk away from cash, you should consider anytime you purchase a home with a mortgage.) That is another blog.