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Case Study: 5524 Ashworth Ave N
There are a few things that stand out for me in this project. They are:
- The importance of a good process
- The importance of a good team to implement that process
- Standing firm on price when appropriate, and
- The importance of managing the appraisers visit
As I left this property after meeting with Angie and James about listing it, I called my wife, who calmly said toward the end of our call: “Well, I think it is going to happen tonight.” It was the birth of our son, Tommy. It turned out that he wasn’t born until the next day, but…Holly’s labor sure happened that night. Thankfully, I have a process, and a great team to support me, so we were able to get the property listed and enjoyed great success.
We had considered listing at $1,400,000 based on other local inventory, but decided to push the number based on the premium we felt the home deserved. We considered lowering the price at two weeks on the market (the sellers had their own infant at home so showings were inconvenient, and also wanted the proceeds for a home they were under contract to purchase), but decided to hold the line on price, as we still believed in the value. We soon heard of one offer coming, and were able to use that offer to encourage another party to get off the fence which…encouraged that first party to make their offer better.
We sold at $1,665,000 and created what I call “an appraisal problem.” It is a goal of mine to create this dynamic whenever I represent sellers; a house that is under contract for more than the appraiser is likely to see the value for. I met the appraiser at the house with my version of the “comps” for the property. She pointed out that the actual square footage of the home – per her calculations – was less than the city record. I argued that that it didn’t matter; that the quality of the property stood firm, and shared an example of a smaller-sized home that had recently sold at a similar price (across town). The appraiser agreed and the sale closed. The family moved closer to their extended family and we all smiled.
View listing details here.
Why does valuation seem so difficult?
I found myself yesterday casually acknowledging as normal the 20% difference between the "comps" my client was finding for a property and the price at which I told him it could sell for if handled correctly. It seemed a bit nuts, so I went further, saying that there is a lot of "play" or "fudge" or "variance"….none of those are the exact right word…in real estate pricing. A case can be made for a big delta sometimes. For instance, the $499K home on Mulberry Street….get all that stuff out, clean it, stage it, implement a serious "go-to-market strategy" / product release….and I suggest a list price of $600K, maybe more. Few want to admit that such a range exits. After all, an asset is "worth what it is worth," right? Any appraiser can help us sort that out? No. That's just a construct we use because we need _some_ system; any system. Weather, presentation, promotion, pricing, and good deal doing all make big differences.
