I Want A Good Deal

What is a good deal?  Almost all my clients start off by initially asking me to find them a “good deal.”  The joke in the office is if we found this “good deal,” we would buy it ourselves!

Realistically, if your idea of a good deal is saving some money, which it probably is, then foreclosure auctions and short sales (read my previous articles about short sales) wouldn’t be a bad idea.  Wait, there is a twist though, you have to show up with all cash, and what you see is what you get.  You don’t get to conduct the typical buyer investigations or have a contingency period.  You win at that auction and the home is yours.  With real estate, what you see isn’t what you always get.  There could be problems with the title or the structure itself so an auction is real risky and that “good deal” you are looking for might end up being a bad deal.  Of course, most people don’t have that much cash at hand and wouldn’t want to take the risk even if they do.

Another potential “good deal” is if you buy a home that would need some fixing up.  The catch with this is you need to put some work into it but most buyers don’t consider this a “good deal” since it involves work and can’t see past the ugly to realize a home’s full potential.

Let’s examine the typical buyer and seller.  A seller wants as much as he can get for a home, and a buyer wants to pay as little as possible.  There is a conflict there don’t you think?  When both a buyer and seller meet in the middle as far as price is concerned, then a deal has been reached! 

Buyers that want a good deal must understand that homes aren’t sold by a giant company that offers clearance sales.  They are sold by private entities each wanting top dollar for their home.  Sometimes as a buyer, you may have to even offer more than what is listed.  Is an amount like $5,000 worth getting in the way of your dream home especially since most home values will appreciate?

In the reverse situation, sellers need to understand that buyers want to pay as little as they can so like any wise shopper, they will shop around and compare.  If your home is priced too high then you have priced yourself out of the market.  Think about it, you didn’t want the home you are in now because it was more expensive than other homes at the time did you? 

A competitive market analysis where similar homes in the similar condition are reviewed to arrive at a reasonable price is the best way to get a snap shot of the current market value of a home.  This is beneficial for buyers and sellers alike to get the best price on a home so it is a win – win situation for both parties.

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What Is Online Is Accurate…Or Is It?

Since the age of the internet, everyone has relied on it for information.  With the abundant amount of information out on the internet you can almost get PHD using Google.  However, the information out there may not always be the most up to date or accurate.  Wikipedia, a popular online encyclopedia is a well known lighting rod of criticism for having inaccurate data since anyone can edit it.  So it is no surprise that a study conducted by the WAV Group on behalf of Redfin found that online real estate sites are not giving consumers the full or accurate picture.

Zillow is one of my favorite sites because of all the intuitive tools they have like the mortgage calculator, however, when it comes to the data, I would not rely on it.  If you look up their Zestimate home value estimate, it is terrible with complaints on their forum board left and right.  Their estimate is either way too high or way too low.  Unfortunately some home owners and buyers take this information as if it was the law so you end up with sellers listing too high and buyers offering too low.

It is important to note that market value changes from time to time.  The most effective way to determine the value is through comparables of similar homes which is what my competitive market analysis does to get the best price for my buyers and sellers.  It is more than just comparing the homes with the same amount of bedrooms in the same city which is what some of the internet real estate sites do.  The condition, lot size, and building size must also be factored in to get an accurate picture.  A competitive analysis goes into much more detail especially since a similar home a few blocks away even in the same city is valued differently. 

Remember this, don’t just always trust what is presented to you, VERIFY.

Study Finds Gaps in Online Listing Information

DAILY REAL ESTATE NEWS | THURSDAY, OCTOBER 04, 2012

Some home shoppers may not be getting a full or accurate picture when they view listing information on some popular real estate Web sites, suggests a study conducted by the WAV Group on behalf of Redfin. 

The study evaluated the accuracy of information contained in more than 6,000 listings among 33 ZIP codes on five sites: Zillow, Trulia, Redfin, and two regional real estate brokerages — Windermere and Long & Foster. 

The Redfin study found that 36 percent of the agent-listed homes shown as active listings on Zillow and 37 percent of those on Trulia were no longer for sale on the local multiple listing service. 

“Zillow and Trulia do not dispute that their listings have some gaps and inaccuracies, though they dispute some of the particulars of the Redfin study,” The New York Times reports. “There’s a simple reason they don’t have everything their rivals do: Neither of them belongs to the local MLSs, which provide the most complete set of agent-listed properties.” 

Zillow and Trulia are not real estate brokerages. Real estate brokers can provide electronic feeds or add their listings so they appear on the real estate sites. As such, some agents that do provide feeds to the sites don’t take listings down quickly after the property sells, says Glenn Kelman, chief executive of Redfin. 

Trulia says it is forming stronger relationships with brokers so that it can improve the accuracy and completeness of its listing information, according to The New York Times. Zillow said it was making a similar effort. 

“There is no gold standard for listings data, so comparing Zillow’s MLS-only listings to an MLS isn’t going to give you the whole picture,” says Cynthia Nowak, a spokeswoman for Zillow, adding that Zillow also includes items that aren’t often listed on the MLS, like for-sale-by-owner listings and new construction.