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Successfully buying a property is a complicated exercise, even with new construction. Don ‘t go it alone! Our MBI FL Realty teams have the experience, resources and contacts to successfully reach your goal quickly and smoothly.
Pricing
At MBI Florida Realty, we help you determine the right price for properties at a level that accurately reflects value in current market conditions. Making an offer with the right context makes a difference. On another note, pricing includes a number of strategies. This is always a point of discussion.
Security
Security is a major consideration when buying or selling a home. By using us, you can rest assured that all our team members follow our safety requirements and that you will be accompanied by your agent or team member at all appointments to view properties or builder visits (new construction).
Negotiating
When negotiating a purchase, most buyers and sellers prefer to deal with a middleperson who is objective, unemotional and professional. Buyers will often feel more comfortable with an agent when they want to raise issues that need resolving before making an offer.
Monitoring, Renegotiating, Closing or Settling
We will guide you through the minefield of potential problems associated with the appraisal, inspection and financing process, including the often complicated escrow instructions. In addition, we can recommend any specialists or tradespeople who may be required for repairs.
CLICK HERE to contact us. You will receive a call within minutes for assistance with buying or selling your home.
Click HERE for mortgage services from our trusted lending partner.
4. Having an Expert On Your Side
As stated before, sellers do not ultimately determine the selling prices. The market does. The market is the overall behavior of home purchasers within an area and timeframe. Whether the listing agent educated the seller and priced correctly is the biggest factor that influences how long it takes properties to sell. As you can see in the above charts, the length of time it takes to sell influences the sales price also.
Market driven pricing means the property is priced correctly and the seller expectation is that the selling price will be no more than 3% lower than, or potentially higher than, the asking price.
Seller driven pricing means the property is priced according to the wishes of the seller regardless of market conditions. This scenario can turn into a seller who believes their home is priced right because the agent is listing it.
Seller driven pricing can create a situation where we need to coach the listing agent to present the right offer the right way.
This strategy doesn’t always work, and these homes can linger on the market for months, and in some cases, years! We all react when our expectations are not met. Emotions can run high in real estate transactions. Sellers who see low offers can react emotionally. They can hold firm, or ‘split the difference’ between offers and their price. Some may remove their home from the market, or change listing agents. Some will even raise their prices!
The effect of the pandemic has brought some interesting strategies to market. Sellers do not want unlimited visitors to their homes and one strategy is to place the home on the market for a limited time below value to drive interest, then they call for a highest and best blind bid. This is obviously a tactic to bring in bids above asking price. If it doesn’t work, the seller is not obligated to accept any offers, and they can start again with a different strategy.
What Determines Fair Price?
Source: Stellar MLS
Source: Stellar MLS
This is the average percentage difference between the Selling and Asking Price by the length of time the home was on the market.
Figure 2 - Time on Market vs. Price
This chart illustrates the level of excitement and interest in a new listing over time. It also demonstrates the importance of pricing correctly. When a property is first listed, it generates a very high level of interest from prospective buyers, which reduces dramatically over time. It is important to be priced correctly from the beginning, during the peak of this curve.
Figure 1 - Buyer Interest vs. Time on Market
4 big reasons why pricing right = quick sales at the highest price & best buyer and seller experience
- More Buyers Look at New Listings - The interest is at its' height early and it drops off dramatically and quickly. We all know that more interest and activity brings higher sales prices.
- Living in a Listed Home is an Undesirable Experience - Interruptions, safety concerns, loss of privacy, need to always keep the home perfectly presentable, and more reasons
- Seller Carrying Costs Lower The Final Net Dollar Amount
- Listings That Have Not Sold Quickly Create Suspicion - “There's something wrong with the property.” Most buyers suspect that it’s not only a pricing issue. The price must be way too high, and low offers come in. Eventually, the seller only sees these low offers and they have to take one
The goal for a successful and professional listing Realtor® is to start with a list price that will generate the most interest, capture the highest price, and sell quickly. This is a very difficult goal.
The common thought is that a fast sale means that the property was priced too low. This is incorrect. Properties that are priced low can generate multiple offers that result in selling prices above market value.
The unexpected reality is that pricing a property too high ultimately may result in a lower sales price than expected. The research supports this. See the charts below.
3. Understanding the Seller
Now that you have your goal defined, It is time to set your expectations properly about the market. Vast amounts of information are available to Realtors®, and it takes experience and knowledge to gather the correct information to guide you properly.
Please note that we find bad data often on consumer websites, so if you use these sites for searches, be aware that you may be seeing incorrect or outdated information.
Here are some of the tools we use to help you to understand pricing and values for homes that match your needs in a specific location.
MARKET REPORTS
Sellers don’t set the final prices in the market. Buyers do. They define values with the assistance of their trusted agent and when they buy, market values are established.
Taking note of buyer behaviors over time helps you to understand pricing better and hopefully predict the type of offer will succeed.
TAX REPORTS
Local governments receive much of their funding through these taxes. The rates are assessed at the local level and can vary by county, and they are based on the value of the property. We also help you understand exemptions.
HISTORY ANALYSIS
Every house has a story. Understanding the background can help in preparing a good offer.
Flood maps and designations determine the need and degree of flood insurance required.
MORTGAGE SEARCH
Sellers need to satisfy all liens in order to sell.
CMA (COMPARATIVE MARKET ANALYSIS)
This is a robust analysis of comparable properties in the area. In addition to the above, the analysis will include the following:
Listed and Sold Prices, and Adjusted Prices to allow for the differences in the properties so they can be compared. Active listings, pending* listings (sold but not yet closed), and sold (closed) listings should be included in the CMA, however, sold listings are the most important to consider.
*The actual selling price of pending listings is not revealed until they close, but considering them does serve a purpose we help you understand.
2. Personal Prep (know your market)
New construction should play a major role as we come out of the days of the pandemic. Market conditions point toward an aggressive effort for builders to capture business, so we recommend checking builder offerings as part of your search.
Points to consider:
- Most builders focus on building within their own unique selling proposition.
- Work within the builder’s strengths to get the home that best meets your needs.
- The agent you meet at the model homes works for the builder, but the builder will pay for your representation, so have us on your side when you visit the builder.
New vs. Used
Going out and touring homes is generally where most buyers start. Save yourself time by clearly considering the features that will be most important in your home. Usually we can cover all of these areas in our initial 20 minute meeting. The benefit to you is a greater confidence in your decisions, and you’re less likely to miss out on getting the home that’s best for you.
Home Type
Is there a general area that draws you?
Consider the following:
Lifestyle
- Where do you like to shop?
- Consider commute time to regular locations like work, highways, schools, houses of worship, entertainment, and recreation.
- Who do you want to live near?
Neighborhood
Looking at overall price range of the neighborhood, the entrance, home and lot size and characteristics, amenities, views, age of the homes, condition, and the flow and architecture styles can help with choosing the right place for you.
Schools
School districts can have an impact on value in Central Florida. It’s important to consider.
Age of Home
Some areas of Orlando have homes that were built before WWII. These homes can present their own challenges. It’s important to know what you’re getting.
Very few homes were built in the 40’s, but there were many built in the ‘50’s and ‘60’s and certain mid-century built areas appreciate in value while others struggle.
Newer properties and particularly new construction provide money and time-saving technology, but building a new home in an established area is not always a good idea. Understanding the influence the surroundings have on value is important.
Determine Your Desired Location
Establish Your Price Range
The information contained herein is not a guarantee of any loan availability, qualification, interest rate, or closing costs. Actual rates and fees will be quoted by your mortgage company and title company. MBI Florida Realty LLC is a Central Florida-based real estate brokerage company.
If you are thinking about buying or selling real estate in the Central Florida area,
you might want to consider acting soon.
4 Steps to Successful Homebuying
ARTICLE | NOVEMBER, 2021
1. First Things First
Begin with a WANTS & NEEDS list. Clearly defining your “must haves” is the best thing you can do to get started. Nobody wants to search endlessly for a home. Discovering what you like and don’t like as you go along adds time, uncertainty, and can result in bad decisions. Creating a goal and sharing it with your Realtor® helps us to work efficiently together and succeed in finding your next home.
NEEDS These are must-haves. Without all of the items on this list, properties should be eliminated from consideration. We are all different, and so are our needs. You decide whether these characteristics are absolutely necessary or they are optional. These optional choices are your wants.
WANTS If you can do without these and still be happy, they are defined as wants. Prioritizing this list is important. Some of them may jump into your needs list.
For cash buyers, budget in an additional 2% - 3% for closing coats and pre-paids. Contact your bank and arrange a proof of funds document. Sellers will require this with your offer.
For mortgages, establish your buying power by speaking with a trusted loan officer and making a loan application before you start looking. Sellers require a pre-approval for a loan along with offers.
When you find the right home, being able to submit a good offer quickly is the key to successful home buying.
To make your loan application with our preferred lender click at the bottom.
Drop your stress level and increase your homebuying success with these 4 Steps
Schedule a Consultation or Select the Reports and Guides You Would Like to Receive
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