When we start the process of taking our property to the market we all begin with one of the most important and fundamental elements – setting an appropriate price for our property and developing a pricing strategy.

The last thing you want is to put your property up for sale and have it sit idly on the market without it generating the interest it deserves. Typically, the longer a property is on the market, the harder it becomes to sell – as potential buyers start to wonder if there’s something not quite right about the property. In these cases while it will eventually sell if will often be at a discounted price.

Often the only thing delaying the selling of a property is the asking price. Of course we want the best price for our property – but when you meet the market’s expectations on price, you will attract buyers. And once we’ve gained the interest of one competitive buyer, then we’re ready to negotiate a great price for your property. 

ONLINE TOOLS – As time progresses there are more and more publicly accessible websites that provide estimated values of properties. Frequently a quick look at the suggested range, low to high, suggested by these sites shows such a wide margin that the numbers are effectively of no value.

Our experience has been that the values these websites suggest is often significantly different to what proven methods of appraising property suggest the property is worth. The reasons they vary are because they are generally computer model generated (see comments re CV’s below).

CAPITAL VALUE (CV) – Mainy of us put weight on the CV when we think “what is my property worth?”. There are a number of reasons the CV (sometimes referred to as Rateable Value or Rating Value) may not provide you with a meaningful price guide.

• CV’s are generally generated every three years using a computer model without a physical inspection of the property. Chances are that the property market will have significantly moved since the last CV was generated.
• Your property may be quite different from the typical property in your area (significantly larger/smaller, views, newer/older, better/poorer condition, more/less usable land etc.). In this case automated/computer models such as those used to generate CV’s have difficulty determining a meaningful value for a property.
• Your property may have substantially changed since the last CV (e.g. an increase in floor area (e.g. an extension with an extra bedroom and ensuite, a new shed built, or even a portion of land sub-divided off). Even if the Council is aware of this, e.g. because of a Building Consent, the CV may not be updated until the next time they are generated.
• More frequently than you might expect the online information held about a property used to generate CV’s is incorrect/incomplete e.g. house area incorrect, house missing entirely, number of bedrooms or bathrooms incorrect).

An experienced Real Estate Professional will utilise their experience to evaluate the properties that have recently sold, and even that are currently on the market, to see how your property compares. They will identify any differences they consider significant, e.g. land size, land contour, house size, house construction, house age, house features, property location relative to amenities and arterial routes, property condition, views and their experience in relation to the current market conditions to put an appraised value on your property.

An appraised price is the price that the Real Estate Professional believes you may realistically obtain for your property were it to be on the market at the time of the appraisal it is not a recommended listing price if you were listing your property with a price.

A WORD OF CAUTION – A common trick undertaken by the less scrupulous Real Estate Salespeople in the market is called “Buying the listing”. This is when the Salesperson overstates the price they believe they can achieve for your property so as to get, or “buy”, the listing. After a relatively short period of time they’ll be stating that the market doesn’t see your property at the price it is listed at and be suggesting a relatively large price adjustment down.

If you have any questions please contact us.