Yesterday I stepped into the minefield that is defending real estate brokers. In the post and the comments, pricing your apartment is the big issue. I maintain a knowledgeable broker earns a good chunk of his or money with this one act.
Today I ran across a Wall Street Journal column that discusses another way to get a sense of price: hire an appraiser:
With home sales slumping and inventories on the rise, experts say getting your home sold depends a lot on pricing it correctly. One tool sellers can fall back on when the market is shifting is a home appraisal.
You can have an appraisal done before you contact a broker or if you’re just curious what your home would be worth. They cost, on average, from $250 to $400 for a single-family home, slightly more for multiple-family dwellings.
An appraiser will physically inspect your house for shoddy workmanship or needed repairs, measure its dimensions and takes notes on the floor plan, utilities and other factors that affect pricing.
He or she should also look at three or four “comps” — comparable homes in your neighborhood that have sold within the past six months — and analyze how homes currently on the market are faring, says William J. Doka, owner and president of Erickson Appraisal Company in Fair Lawn, NJ.
In theory, that’s a great idea. But over the last seven years, as the market has been rising, appraisals have often fallen short of conditions on the ground–meaning that you’re leaving money on the table if you leave the pricing to an appraiser.
Not to mention that in New York at least, appraisers almost always rely on brokers to help with the appraisal by providing comprable listings.
To me, that means an appraisal can be a helpful starting point of the pricing discussion. But, as the WSJ suggests above, it doesn’t replace the value that a knowledgeable broker brings to the table.