Property Worth?

Question

How much would you pay for a property that was in like new condition, 3 BR 1 Bath brick home, hardwood floors throughout, with exception of kitchen and bath which has new ceramic tile. The home has brand new replacement windows and a maintenance free exterior and was built in 1981. Everything new, from the appliances, HVAC, roof, custom built kitchen that was built to be landlord friendly, along with many other extras. The property should generate income no less than $1100 to $1300 a month. There is no doubt that this property will have at least a 10% appreciation per year over the foreseeable future. To add, I will sell the property 10% less than assessed value for the right offer. It will appraise for much, much more.

Just how much is the property worth?

Account Closed · Answer

@Edward Briley

OK, I'll bite... I guess its worth what a buyer is willing to pay for it.

How much is that? Try researching comps in the neighborhood. Tip, don't use the asking price on MLS for your comp, look at the prices of actual homes sold.

Randy Johnston · Answer

A few things that will affect the marketability of a property;

1–Is the property on a busy street? If so, that brings the price down by about $10k and reduces your buyer pool (as least that's the way of it in the Greater Portland Metro Area).

2–Is the floor plan "unique?" If so, that will turn away a lot of potential buyers, they don't want to have to conform to the house, they want to be able to move into a home that feels comfortable to them.

3–To whom are you marketing the property? If you goal is to sell it to an investor . . . are you concentrating your marketing for that segment or to a homeowner? What does your Realtor say?

4–Are you on the local MLS? If you're trying to sell your property yourself, be prepared for the property to sit for awhile. Check out these stats (from 2013) on home buyers and sellers . . . the one that really stands out is that 88% of home buyers used a real estate agent, so unless an agent knows about your property, she/he will not know to show it to their clients.

5–Do you make your property available for immediate showings (1–4 hours notice)? Buyers have a habit of contacting their agent to see a home or multiple homes on the same day. I say this because if an agent is showing multiple properties in a hot market, but not yours because they can't get in, and the buyer wants to place an offer on a home they really like they'll put their home search on hold.

There are more reasons that a property isn't selling, but these are some of the top ones.

I hope this helps.

Randy

Edward Briley · Answer

Oh, and by the way,  My Realtor tells me it is because of the school district it is in.   I want to tell you there are waterfront homes for sale for under $200,000 not far away that are in the same school district.  However, rentals are booming in the area.  I am a flipper, not a landlord.   It is sad to tell you that homes in another school district are for sale less than a block away from a comparable $200,000 home, for over a million dollars.  Same waterfront view, same street.  Matter of fact a few of them.  Isn't it a shame that a school district would dominate the cost of homes that significantly?   Needless to say those million dollar homes have not sold, and most are now "For Sale by Owner", even though they are in best school district in the city.    Water front homes that do not require flood insurance are few and far between, however, many of these do not.

One more thing, a city council women lives two doors down from the home I am trying to sell and has two children, that attend private school, because the city has a voucher program for that area.   Why would she and her family live there?  The houses are increasing in value, newer, and you get a lot of bang for your buck at present, so until the home sells, I will pay the real estate tax, utilities and sit on it.  I may not be asking enough for the home is why it has not sold.  When my contract expires with the broker I have it listed through, I will sell it myself within a short period of time, I am sure.  I just find it sad, that a home that nice and beautiful is not selling.  The only reason I bought it is so I could make it a nice home for a family, that was inexpensive to own and maintain.  I would be surprised if the appraisal came back on the home for less than $125,000.  The homes that were used is comparables were either foreclosures, or houses needing a lot of work.  The last home on the block sold in 2011 for $69,900.  It needed a lot of work in which the owner performed.  The reason not many have sold on the block is because most of the residents bought the houses new, and have stayed there or sold them in the mid 90's.  Of 25 houses, 2 are rentals, and one is vacant, because the owner is in a nursing home.

The lowest price home for sale in the area that is a comparable is also a foreclosure the bank is trying to sell for $60,000.  It is a little smaller, and needs a lot of work as well, and on a street that is much lacking curb appeal.   They may be waiting for mine to sell, before they will take a lower offer on it, I don't know, but I have made a few offers on it they have refused.  With the work the city and investors are doing not far away from the home, that I can see its future value of this area going through the roof, mainly because of its location.  It is located within walking distance of one of the areas largest employers which is pressuring the city to upgrade it's surrounding neighborhoods.  Good paying industrial jobs are located on both sides of the neighborhood.

Edward Briley · Answer

The comps show it should have a selling price of about 90 thousand, in which it is for sale for that amount.

ROTIMI OLUWO · Answer

Somewhere between $30,000 and $5,000,000

Eddie Werner · Answer

If you provide the address we could probably pull comps and a range rather quickly.  You could do this just as easily.

Wayne Brooks · Answer

Obviously, it's not worth $150k if you can't sell it for 80k.

Edward Briley · Answer

Well the truth of the matter is that I don't know what it is actually worth for a rental?  I will tell you this, an appraiser should be able to tell me with just a few calculations.   IMO it should be worth around $150,000 dollars, but I have it up for sale for a little more than half of that, but would take that half of that for it.  It is odd that it hasn't sold yet.