If you are thinking of selling your home in Maplewood, South Orange or surrounding NJ towns after the holidays, one of the most critical decisions facing you is how to price it. When you price your home correctly from the start you avoid leaving money on the table or having your home languish on the market. But how do you determine the best selling price for your home? That’s where a market analysis of “comparable sales” (“comps” for short) comes in. Let’s take a closer look at what comps are and how to choose comps to price your home correctly.
What are comps?
Comps are recently sold homes in your neighborhood that are similar in size, style and condition to yours. By recent I mean closed sales from the last 3-6 months. When looking for comps to price your home you should try to compare apples to apples. In Maplewood and South Orange that can be VERY tricky because no two homes are exactly alike. (That’s what keeps me on my toes!) The following items are those that you should take into consideration when finding comparable homes to yours.
Look for homes that are geographically as close to yours as possible and within the same zip code. Most professionals prefer to look at properties two miles or less from the one they are evaluating. Homes that have location problems such as being close to power lines, abutting commercial properties or on busy streets will have a lesser value than homes in more marketable locations.
Size is also important when finding comps. If the home you are selling is 1,500 square feet, then you will want to look for homes that are also around 1,500 square feet in size. Neither basements nor unfinished spaces are not included in square footage calculations. Adjustments for square footage differences can be made in the market analysis process.
When selecting comparables, one should only compare like property types. Single family homes should not be compared with condos or multi family properties.
Ask yourself the question, would the buyer who purchased that potential comparable property likely be interested in mine? If you have a character filled Victorian charmer it should not be compared with a starkly modern split level. The same buyer probably would not want two such different homes. Again, compare apples to apples and colonials with colonials.
Features and Condition
Compare homes to yours that are similar in condition. If your home has a new kitchen and baths select comps with similar updates if possible. If your house has central air conditioning and a comparable one does not, an adjustment for the value of this feature has to be made. We have access to the market value of a myriad of features from finished basements to garages that we use to accurately price homes.
Sometimes a house just has a certain something. All the decor works together really well, it has exceptionally pretty landscaping or the street is just so picturesque. Or maybe the new kitchen cabinets that someone just installed are a bright red and won’t appeal to a wide audience. Those things are hard to calculate in dollar terms but will impact market value.
How do you find comps?
You need access to market data, square footage data and valuation adjustments that can be found in various online sources. It’s also very helpful to have seen the comparable homes in person. A real estate professional will also have inside knowledge of what pending homes will be closing for which is helpful to assess the direction of the market and the value of your home.
Wondering about the value of your home and how we would position it to perform its best in the market? Do not hesitate to email me at [email protected] to set up a time to chat.
The Allison Ziefert Real Estate Group is a top producing real estate team based at Compass in Short Hills, NJ. We are local market experts, specializing in real estate and homes in Maplewood, South Orange, Millburn/Short Hills, Montclair/Glen Ridge, West Orange and Morristown, NJ and the surrounding towns. We are driven by earning great testimonials and referral business from happy clients. You can read our reviews here.