Evaluating the listing price of a home is one of the main jobs of a Realtor, and there are
so many factors that it is as much an art as a science. Realtors, particularly those who
regularly work Hidden Meadows, are very good at predicting the eventual sale price of a
home, but evaluation is NOT an exact science.
I was designated as an Expert Witness on Real Estate Values by the Superior Court of the
State of California in 1978, and I can attest that Hidden Meadows is as difficult to
appraise as any place in the world. We have an entire community of custom homes, some new,
some old; some luxurious, some rather plain; some on tiny lots and some on huge acreage;
some with great views and some nestled in for privacy; some with pools, and some
without...
Appraisers would like to make evaluations based upon $ per square foot, and that concept
has some validity in areas like Rancho Bernardo where one Acapulco model is very similar
to all Acapulco models except for decoration. In Hidden Meadows, similar sized homes may
have vastly different construction -one uses tile, one Corian, one marble. One may feature
Honduran mahogany throughout, while another of the same size has painted pine. One may
have a pool and a view forever, while another may have neither. Based on price per square
foot, they would all be judged the same -- but they are not the same, and the prices of
the listings and the sales will reflect the differences because the market is usually
right.
Still, $ per square foot is A measurement, and useful when modified by
knowing the homes that have sold, intimately. If the real estate professional knows the
houses in the area well, they can modify the $ per square foot by adding an appropriate
number for pools and views, newer appliances, etc. and subtracting for outdated kitchens
and baths, location, shake roofs, etc.
The real arbiter of prices is the market, and that is best reflected by recent comparable
sales. The low rate of sales over the past five years, and the vast differences between
homes in the Meadows, makes both "recent" and "comparable" suspect
terms in doing evaluation, but knowledge of the area and experience can smooth out those
bumps. Where there is a dispute, bringing in an MAI Appraiser will be useful -- they are
an independent third party with excellent credentials.
In any given price range today, we can only show four or five homes. If those available
homes are not just quite right, we must place them on our "watch" list and call
them when a home in their price and general specifications comes on the market. If a newly
listed home sells within the first two weeks it is usually not because the price was too
low but rather that an agent had someone in their "back pocket" and the buyer
had been looking in Hidden Meadows for weeks or even months.
(Sometimes, years. Jean and I looked for our Meadows home for almost 5 years! )
On the other hand, a home does not sell in a reasonable time (which varies because of
price -- less expensive homes naturally sell faster because there are more people
qualified to buy them), then it is likely that the house has been priced substantially
above the market. Usually a real estate professional will try to recommend a price where
they believe the home will sell in a reasonable time, but real estate professionals are
human also (!), and they sometimes recommend prices that are too high because the
professional really loves the home personally and gets carried away. Alternately, some
sellers have so much emotion involved in their home that they set a price that makes them
the highest bidder on the home. Obviously, if a home is priced at $1 it will sell in one
second (the real estate agent will buy it on the spot) -- and if a home is priced at $100
million it will NEVER sell.
Any home will sell when it reaches the "market clearing price", and in real
estate that means a proper price and sufficient exposure to a reasonable number of
qualified buyers. Real estate professionals want to sell your home quickly, and, since
they do not get paid until the transaction closes, a wise seller will listen to the
pricing recommendation carefully.
Back
to Top
Where can I find a good Realtor?
We had a call from a local resident who complained to us that he had listed with a real
estate broker from the coast on the recommendation of a friend. The friend said the agent
was just dynamite. The real complaint was that the coastal hotshot had taken the listing
10 days before, but had not placed the property in the MLS, or put a sign on the property,
or produced flyers, or...
Our office jokingly asked the seller if he had to tell the coastal hotshot how to get to
Hidden Meadows, and the seller said "Well, yes, he did not know where we are."
Within 4 hours we had the property on MLS, had a yard sign on the property, and had color
flyers with color photographs produced.
That should be a clue. It is difficult to represent Hidden Meadows property from half a
county away. Those of us who live and work exclusively in the Meadows are like the anvil
salesman in "76 Trombones" who sang "You've got to know the territory`'.
Our office, and our friendly competitors who work the Meadows exclusively, know the
territory in ways that offices out-of-the-area cannot duplicate. They don't attend the
meetings we attend on road and sewer construction; they don't know about future road
plans; they don't know the demographics and psychographics of the residents, they don't
know what new buyers in our area are looking for; they don't know who the local builders
are and who does what kind of repair work; they don't know...much about the Meadows.
I have a mental picture of someone going to an office in Oceanside and asking to see a
property in Hidden Meadows! Our location attracts buyers -- that is a fact of life. As
cooperating Brokers, we show and sell ALL listings in our area, and we don't care who or
where the listing agent is. What we do care about is that the home is properly priced, but
it is difficult to properly price a home from far away. We like to show well-priced
listings of agents with whom we can easily and quickly communicate.
There are not many of us in-area Brokers, and we compete on a friendly basis.
Many are
professionals, and we sell their listings regularly. Our location gives us the visibility
to attract most of the new buyers and most of the home listings.
But we do muse about what causes a Meadows homeowner to list with an agent from many zip
codes away.
Back
to Top
The quick answer is that it is overpriced. Assuming that your home has been exposed to the
market for several months, each day that your home does not sell, it means that on that
day you have become the highest bidder for your home because of the price that you have
placed on it. Your Realtor will tell you the average time that a home in your price range
remains on the market, and if your home does not sell in that amount of time, or sooner,
then the price is too high.
All sellers have an emotional price that they place on the home, and it is usually higher
than the actual market price. Sometimes a Realtor will reinforce that unrealistic
impression in order to get your listing. That inflated price will not help your home sell,
but it will get the Realtor more exposure through signage, and, eventually, the Realtor
will approach you to reduce your home to a more reasonable price.
Never list with a Realtor who promises he or she can get you more than another Realtor --
they can't. Some Realtors may be able to sell your home faster than others because they
have more walk-in Meadows traffic, or they happen to have a buyer in their back pocket or
the back pocket of an associated Realtor, but once your home goes in the MLS everyone has
an (almost) equal shot at selling your property.
Once your home is in the MLS, it is a numbers game. The more people who are exposed to
your home, the more likely it is to sell. The more web pages the property is marketed on,
the better -- and the more web pages that people actually use the better. The more willing
your Realtor is to "Open House" your property, the more exposure it will get and
the more likely it is to sell quickly,
Your home will receive the most traffic during the first few weeks of listing
as buyers who have looked at all previously listed homes look at your home. It is during
this time that your home has the greatest exposure, so price your home to sell
immediately. Don't waste the "good" price for the time when your major traffic
has dwindled.
Many years ago I had the opportunity to tour the Rolls-Royce plant in England,
Being a brash young engineer, I thought I could detect the "secret" of the
longevity of those automobiles. I did, but it was not a secret. It was just doing what
everyone else did, but better. It's the same with selling homes. There are no secrets.
Some people can just execute on the "knowns" better than others can.
Back
to Top
My Meadows Blog -- which is a monthly update on the
market, is at
http://www.allenhemphill.com/weblog/welcome.html
Even though our population is getting younger in the Meadows, single level living is the
preferred floor plan. Homes with more than one level are acceptable to a large population
if the second level contains less necessary space, a third or fourth bedroom or an office.
If the main living, including the Master Bedroom, is on the main floor, that is preferable
to the necessity to climb stairs several times a day -- but a one floor home is always the
easiest to sell. Lower priced homes, particularly those below $650,000 on one floor
virtually jump off the market. Higher priced homes naturally only attract a small percent
of the buying public because few can afford them, but those with great views and enough
land to provide privacy have an excellent potential for resale.
Back
to Top
The quick answer is: Warm abut to longer getting warmer. There are many historic
indicators, and the first best indicator is number of homes listed.
I have seen 55 homes listed in a slow market, and nine homes
listed in a hot market. You can go to
www.allenhemphill.com/homes.htm
and count the homes for sale...it is the single best indicator of the market. Well priced home below $650,000 sell particularly fast.
Single level living is very popular, because, although the market is changing to younger
buyers, most people prefer single story living. If you have a home that has several
levels, but all the major living can be done on one level, that is single story living and
will attract the largest number of potential buyers.
Historically, homes sell better in April through
September.
Back
to Top
For many years, Hidden Meadows was thought of primarily as a retirement
community, with golf as its main draw. More recently, our community has fallen
within the primary driving range of successful business owners in San Marcos,
Escondido, and even Vista who are looking more for quality of life than golf.
Consequently, our buyers are younger, more affluent, and play golf occasionally. This changing demographic will accelerate over the next decade as
the commute becomes more difficult and more facilities for business are developed north of
Escondido, such as the often-proposed "Office Park" for Deer Springs.
Back
to Top
