Pricing Your CA Homes: 6 Factors Worth More Than Money
What measurements do you use to price CA homes for sale?
Using traditional appraisal techniques and comparable or income approach comps is the safe option for selling Southern California homes. These options are also good for avoiding snags in financing. However, for those that want to push the status quo, and raise prices, there are some factors which can help homes effectively sell above market value. So if you have the luxury of waiting to sell a CA home, or want to set new records; what factors might be built in to facilitate that?
Security & Safety
Personal safety, keeping the family safe, and even enjoying peace of mind can add incredible value to a home. This could mean incorporating safe rooms, hurricane shutters and advanced alarm systems, better built properties, or even ensuring healthy living environments. For example; in areas prone to certain issues like Chinese drywall; would you as a buyer be willing to take a gamble on what home you get for your young family?
Safety and security can go a long way in selling somebody on a home. Make sure you meet their needs.
Availability, or scarcity, is another factor that can definitely justify premiums on properties for sale. MNS in New York is a prime example. Bidding wars have trumped up home prices across California. We all know that they aren’t making any more land. This can be abused when landlords squeeze lower income workers out of entire areas, or counties squeeze thousands out of their turf by eliminating affordable housing or raising property taxes to a point what it is simply unaffordable. Tt is clear that limited availability does create premiums.
Green home features work to add value in multiple ways. For many home buyers, their conscience dictates they be willing to pay a premium for properties that are better for the environment, even if they aren’t forced to. Energy efficient and resource saving features from better appliances to solar can lower ongoing costs of ownership. So even if the up-front price tag is a little more, home buyers may pay a lot less for these homes over time, and won’t be held ransom by utility companies.
Again; we’ve all heard that they aren’t making more land, and that real estate investing is all about “location, location, location.” That means property in prime locations can be worth pretty much whatever a seller wants to ask. At least if they are willing to wait until someone comes along willing to pay it. This doesn’t always make it a smart move, and can be counterproductive at times. Aside from penthouses, central urban condos, and waterfront homes, this can also apply to proximity. Some may have to or be highly motivated to purchase property in close proximity to work, certain attractions, and more. However, real estate investors, Realtors, and property owners need to be cautious. With the world on its way to seeing 60% of workers working remotely, if they aren’t already, it’s also smart to consider that people don’t have to live in dense urban areas to make a living any more. In fact, it cost them a lot more, and they pocket a lot less when they do.
Newsday Long Island just covered the listing of an old single wide trailer listed for $1.1M. There is a reason that others are willing to pay $2M or even $10M for homes elsewhere that they only intend to demolish. It’s about potential and highest and best use of the land. This is what will also eventually make less popular neighborhood home values grow beyond being affordable as builders eye them for tear-downs and replacing single family homes with multi-unit properties. This is also why properties that were selling for $350,000 in these neighborhoods 10 years ago, and selling for a third of that or less now.
Sentiment is worth a lot more than money to many. It’s why individuals don’t want to sell the family farm to oil companies, and why they refuse to short sale or entertain offers to buy their homes, even in the face of imminent foreclosure.