What is Your Property Worth
Before we show you how to protect yourself against an inaccurate property valuation, here are some commonly held misconceptions many people have regarding their properties true worth.
What your property is worth (i.e. what it will sell for) has NOTHING to do with:
- How much you paid for it.
- How much money you've spent on it over the years.
- How much you'd like to sell it for.
Instead, you would be wise to focus on this one truth:
"Your property is worth what a buyer is willing to pay for it" (just so long as the buyer's mortgage lender agrees that the price is fair).
In turn, what a buyer (and their mortgage lender) will decide is a fair price is determined by looking at:
- The price similar property to yours has recently sold for.
- The price similar property to yours is currently being advertised at.
You see, property valuation is essentially a guessing game and no matter what anyone tells you, the truth is - until your property is sold nobody can guarantee what price you'll achieve.
The best anyone can do, is make use of the information available and take an educated guess as to what home-buyers might be willing to pay.
The best way protect yourself against an inaccurate valuation is to form your own opinion of what your property is worth, and to do this before you approach any agents.
How to Value a House
Two things to consider in valuing a home are, first, how does it compare to similar homes that have sold recently? Is the asking price fair? And second, what value do you place on the advertised features and amenities? Yes, other people might value them highly - but do you?
First find out what property like yours (in your local area) has recently sold for....
Unfortunately, Aruba has no centralized public registration available, notaries do have this information but this route may be problematic and probably an unattainable goal. Lots of websites give direct & free access to listings they recently have sold however, this information is scattered and selling dates are not mentioned, making this also unreliable as "comparing tool".
Market activity also determines how easy or difficult it is to find accurate comparables. In a "hot" or busy market, with sales happening all the time, you're likely to have lots of comparables to choose from. In a less active market finding reasonable comparables becomes harder. And if the home you're looking at has special design features, finding a comparable property is harder still. It's also necessary to know what's going on in a given sub-segment. Maybe large, high-end homes are selling like hotcakes, but owners of smaller houses are staying put, or vice versa.
A good tip is to imagine you're buying your home all over again and see which properties catch your eye.
Keep in mind overpriced properties will not attract serious buyers.
Print off the details for the 5 properties you feel are most like yours. You need to study them carefully, with a critical and unbiased eye and decide why buyers would pay more or less for your property.
How to Realistically Compare Your Property to the Competition
Here are the top reasons a buyer would pay more for a property:
- It's in a better location
- It has a garage or off-street parking
- Has an extra bathroom
- Has double bedrooms
- Has newly fitted bathrooms or kitchens
- Has a large kitchen with dinning area
- Is newly decorated throughout tastefully
- Is well maintained
- Is fenced
- Has an alarm system
- The property is Freehold (Land Ownership)
- Has a superior outlook (i.e. Sea view, on hills, nature (cunucu)
You don't need to know exactly how much extra value any of these things would add. You just need to be critical, objective & realistic about why your competition could command a higher or lower price tag than your own property.
Need Help Value Your Home?
ForSaleByOwner-Aruba.com can help. We can value your house unbiasedly based on current market status, a competition analysis, a technical construction report and an appraisal report.
Contact us now for more information about this.
Need Help Selling Your Home?
ForSaleByOwner-Aruba.com can help. We can connect you with a local expert who will make selling your home as quick and painless as possible. Our local experts will help you navigate the home selling process, simplify your life, and focus on your needs.
Contact us now on how to get started.