When valuing a home on your own, two problematic situations can arise that directly impact the success of the purchase and sale operation: So overvaluation and underestimation are the two pitfalls that are involved in the formation of judgment through heuristics.
A home can be overvalued when one becomes overwhelmed with the sentimental equity of the home, or on the other hand, they can underestimate the selling a home by not comparing the property with other similar offers, not noting the price changes that happen in the micro- marketing of the area of your choice, and not considering the attributes of the property.
If you are going to list your apartment in the market, note that the asking price will determine the duration your home will take to sell as well as the selling price. Below is a list of the 10 things you should never do when valuing a home.
1. Do not use online simulators
An online valuation simulator is a digital tool whose objective is to give an initial estimate on a property. The result is based on the characteristics of the property and data from other homes already sold or for sale in the same geographical area.
Although it is an approximate sale value, the estimate made by an online valuation simulator offers very relevant information to determine the starting price of the property.
2. Ignore the evolution of the market in the area
The real estate market is lively and dynamic, so selling for a price similar to or higher than what you bought will not always be the most accurate strategy.
By not knowing what the evolution of house prices has been in the area, you could sell for a value that is too low or, on the contrary, overvalue the house and reduce its reach on real estate portals.
Analyzing the evolution of prices in your area will allow you to determine a price in line with the market for your home for sale.
3. Do not compare the property with other similar ones for sale
Probably your next-door neighbor or the one across the street has put their home on the market. And at what price? Not comparing your property with other similar ones for sale is a mistake that you should avoid when determining the sale price of your apartment.
If you do not compare and set a price that is not in line with the offer in the area, you may lose sales opportunities or obtain a lower profit.
4. Not taking into account the location of the apartment
Housing price depends on location, in the following way. Every zone has an average cost regulation of the square meter of housing and because of that, not recognizing the location of the property, and the services offered it has (supermarkets, schools, health centers, transportation) will penalize the value of the home.
5. Getting carried away by sentimental value
After having lived many moments and personal experiences in a home, it is normal to build an emotional attachment. For this reason, many owners tend to overestimate the sale price, a mistake that can waste a lot of time.
In this situation, you have to know how to separate the emotional value and the real value of the property, objectively considering what its qualities are and how it is positioned in relation to the existing offer.
6. Overlooking the condition of the property
If you are going to sell a home that needs renovations, that requires changing the aluminum in windows, with the old electrical system or the facade in poor condition, you must apply a discount to the sale price if you want to find potential buyers.
The people who are going to move into the home must have sufficient budget to carry out renovations, arrangements and repairs, so it is a factor that you should not overlook.
7. Not taking into account the energy rating
Did you know that a good energy rating contributes to a higher home valuation? More and more buyers take this requirement into account when choosing their properties. Therefore, it will be essential to process this document to sell the home, the result of which will also influence the sale price.
8. Not updating the valuation of the home if it takes a while to sell
If the home takes too long to sell, there may be several reasons:
The value you have set is too high in relation to the market. The demand is not interested in your home for sale since it considers that for the same price it can obtain properties with better qualities.
The characteristics of your home are not aligned with the demand. It is likely that it will be difficult for you to sell if your apartment does not meet the expectations or needs of the demand.
9. Not taking into account the conditions of the floor
In addition to the condition of the property, there are other important details that can increase or decrease the price. Ignoring the conditions of the apartment, such as the square meters, the number of rooms, the presence of an elevator, a garage or other amenities can lead to an erroneous valuation of the property.
10. Not comparing the price with the opinion of an expert
Valuing a home can be stressful for ordinary citizens who are unaware of real estate market trends. That is why, although it is always advisable to carry out a comparative analysis of the offers in the area, the opinion of an expert will be essential to avoid making mistakes in determining the price, avoid headaches and save time.
