Sales price of homes or property around your is not the only thing to consider when pulling comps. Here are five things that affect comps that you might not be aware of.
1. New construction nearby: Because big builders buy in bulk when building out communities, there is savings to be had for the end buyer. As crazy as it might seem, sometimes new homes can be cheaper per square foot than existing homes!
2. Renovations: Recently renovated homes typically sell for more than homes that haven’t been updated in a while. It’s all about the “wow” factor and how potential buyer feel after they leave your listing. If they feel like they’ve got a lot of work to do, it will effect the offer. Kudos to you if you’ve recently renovated your kitchen or master bath – it could pay back in spades!
3. Developable lots: Here in Austin, all lots are not created equal. Those beautiful hills and rocky terrain could mean big headaches for a builder. Even if the square acreage is the same, a lot that’s flat and easy to build on will get a better price than a lot that needs a lot of preparation because of terrain or drainage issues caused by the terrain.
4. Listing price vs. sale price: When it’s hot it’s hot and when it’s not it’s not. Whether sellers actually get their asking price depends greatly on the market. The listing price doesn’t always accurately reflect what a home will sell for – in some cases there can be a huge disparity.
5. Location. Location. Location.: As the old adage goes, being close to the action can come with a price. Nearby amenities, safety, schools, and noise levels can vary greatly within a neighborhood. Homes in a primo spot will sell for a higher price, all else being equal.