LOCAL, LOCAL, LOCAL
Written By Gail Fattizzi (Executive Director - Relocation Director, NYS Licensed Real Esta). Created on 05/28/2015.
Probably the question most often asked of anyone in the real estate industry is, “How's the market?” Ifyou ask the question to 10 different real estate professionals, you are likely to get 10 different answers! So, who do you believe? Most likely, all of them! Now you're thinking, “Huh? How is that possible?”
Most people understand that the stock market overall can be up, but that doesn't mean that every stock that makes up the S&P, the Dow Jones, or the NASDAQ is up simultaneously, and certainly not up equally. You wouldn't buy one particular stock without conducting your due diligence to make sure its value is rising or likely to rise, and that you are purchasing it at a current fair market value. The same is true with real estate. Individual homes, neighborhoods, or towns can be down while the county, state or nation is up, or vice versa. For this reason, reading national headlines and statistics isn't going to give you the information you really need if you're thinking of buying or selling a home. Real estate truly is hyper-local.
What is it that makes real estate values and trends so local-specific? Economics plays a big role. What is the local job market like? Is unemployment trending up or down? What about supply and demand? If you are trying to sell a 3-bedroom Colonial and there are 10 on the market in your neighborhood of equal quality and condition, but only 2 prospective buyers, you will need to make your home the real standout in price and condition to be one of the two lucky sellers. If you are one of the two buyers with all those homes to choose from, you will likely be able to negotiate a lower price. Condition, style, location, property taxes and functional obsolescence are considerations of each individual property. And then there are other major factors such as commutation convenience, safety, availability of suitable schools, and family considerations. Any of these, along with many other variables, can dictate home values and trends right down to the specific street and even the individual home.
What about those online tools that provide you with an “estimate” of the value of the home you may want to purchase or sell? If you have been reading to this point, you've probably already concluded on your own that there's no way they could give you a true picture of the value of a specific home....and you'd be right! Online valuation models most often don't have all the information about a particular home, their data is frequently outdated, and they certainly have no way to take into consideration the myriad outside factors that translate into an accurate valuation.
If you are moving across the country, then national headlines and data may have some value. Otherwise, it's all about local, local, local. So who should you ask if you really want to know what's going on in the market specific to the home you want to buy or sell? The most knowledgeable local Realtor you can find.
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