In today’s market, it seems that many homeowners have little regard for what comparable properties in their neighborhoods have sold for or what is the fair market value. Most know that the economy is in great shape and that they can dictate price even if the market analysis indicates that their neighbor's home sold for somewhat less.
What is the fair market value of a property and how is it determined? Market value is defined as: “The most probable price a property should bring if payment is made in cash and the buyer and seller are unrelated, well informed and acting without pressure.” The value is determined by comparing the home you are selling or buying to other similar homes that have sold recently in the same neighborhood.
It is called supply and demand and at present the demand is much greater than supply for homes less than $400,000. I was recently told by an individual thinking of moving here that our prices are stupid. I’m not sure about stupid, but I do know that they are high.
This person seemed to think that real estate salespeople set home prices. Nothing could be farther from the truth; the agent usually gives a seller a range on what they think a home should sell for. It is the seller’s decision whether to take the agent's advice or come up with their own asking price.
Homeowners know that the economy is on a roll, that home prices are high and that they can get top dollar for their properties. As long as our economy and job markets are strong, real estate prices in our communities will remain high. No one should begrudge a person for getting the best price they can for their home, even if their asking price is off the charts.
At this point it seems that many sellers have little regard or interest in a market analysis as they know they can probably sell their home somewhat above what their neighbor's house sold for. As we move into late summer I see nothing on the horizon that would indicate that conditions will change anytime soon.