Is This Home Priced Right?

Portland Real Estate Questions:  Is This Home Priced Right?

For the majority of buyers, one of the first things they search for with properties for sale is the PRICE.  With the search capabilities buyers have on the Internet, the price points are always a factor.  When buyers tell their Realtor what they are looking for in a home — PRICE is high on their list.

When it comes time to put pen to paper, buyers want to know:

Is this Home Priced Right?

That’s when their Realtor will run a CMA (Comparative Market Analysis) or a “comp.”

How Is a CMA / Comp Prepared?

When preparing comps for my buyer clients, I use the RMLS — Regional Multiple Listing Service to pull LIKE PROPERTIES.

When comping a property for the purposes of writing an offer I compare apples to apples.

Some of the criteria I use to run a comp:

  • Price range of homes SOLD
  • Age of homes SOLD
  • Sq. footage of homes SOLD
  • Number of beds / baths of, you guessed it, homes SOLD
  • Lot size of homes SOLD
  • Updates and/or improvements of homes SOLD
  • etc.
I stay within the map coordinates and, typically, go back three months for RELIABLE market data.
For some buyers, they may want to “compare” a home they toured that’s located 5 miles away from the subject property.  To them, it’s a “comparable” because they are comparing houses.  Unfortunately, a home 5 miles away may not be a valid comp.  One word reason:  LOCATION

Why Use Only SOLD Properties For a Comparison?

The reason I emphasize SOLD homes is because:
  • ACTIVE PROPERTIES do NOT establish price.  While it might be nice to know what’s on the market in the immediate area, the list price does nothing to establish a viable AND reliable comp.
  • PENDING PROPERTIES do NOT establish price.  While it might be nice to know how long it took to that particular property to go “pending” . . . price is not established.
  • SOLD PROPERTIES DO ESTABLISH PRICE!  Which is why I go back three months.  The market can change dramatically over a 6 months period and might not be reflective of current real estate market data.
While we don’t make offers based on the price of sq. footage alone . . . it is helpful in running a comp to see the “average” price per sq. ft. of SOLD properties.  For example:  An average might show that the SOLD homes are running $200/sq. ft.  The property of interest might be reflective of $170/sq. ft., all other things being equal  . . . might be a pretty good deal and offer worthy!!
*Please consult with a Realtor® in your area for local standards of practice. 

Read my previous articles:

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Buyers Agent Portland, LLC is an Exclusive Buyer Agency serving the Portland Metro real estate market since 1999.  The brokerage only represents Home Buyers and never home sellers. If you’re looking for a home anywhere in the Portland Metro area, there is no better representation than an Exclusive Buyers Agent.  We assist investors, folks relocating to Portland area, those moving to Portland in-state, home buyers who are looking to down-size or move-up and of course . . . love working with first-time buyers.  I help Buyers in the Portland Metro market find exactly what they need in the Tri-County markets of Clackamas County, Multnomah County and Washington County, as well Portland cities including but not limited to:

When you’re ready, talk to an Exclusive Buyers Agent.

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Carla Muss-Jacobs, Principal Broker/Owner
Buyers Agent Portland LLC
14845 SW Murray Scholls Blvd, #110-518
Beaverton, OR 97007
Office: 503.524.2560
Direct: 503.810.7192

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