Predicting Home Value in Cyberspace
New real estate metrics offer agents a whole new way of helping sellers predict the value of their homes.
One of the primary duties of a real estate agent is to assess the value of their seller client’s property. While a value assessment is considered an opinion, it is a benchmark in establishing a responsible and equitable sale price of a home.
Realtors® often employ several tools to assist in their home price evaluation. A Comparable Market Analysis (CMA) is one of the primary tools used to assess a home’s value. A CMA uses similar properties that have sold are pending sale, or are presently for sale to predict what the value of a given home may be. A CMA is also an appraisers tool of choice when performing an appraisal for a mortgage.
In the recent past, real estate agents listed homes and put them on the Internet but had no real discernible way of knowing how many people were seeing a home or had interest. Realtors® relied on calls from buyers requesting information or a showing to assess the overall interest level in the property.
New tools have emerged in the quest to evaluate homes’ worth by using consumer interest metrics. Zillow can tell us how many people have viewed a particular home and how many have saved it as a favorite. Our Multi-list system has developed some amazing tools that show us how many people are searching for a type of home in a given area in a particular price range.
An agent can now estimate what the potential interest may be in a home before it even hits the market. The Trend MLS calls this a Market Performance Report. Once a home is listed for sale an agent can use a Listing Performance Report to review changes in the interest in the home along with data on how it compares to similar property listings.
This new data is different from a CMA in that it shows us what the present or real-time interest is in a property. We can now evaluate the overall interest and match it to the current inventory of homes. If there is a lot of interest for a home that matches certain criteria and low inventory, the home being evaluated may be worth more than what a CMA alone can tell us.
These new tools provide levels of insight and information that help real estate professionals better understand underlying conditions in a given marketplace. This is yet another reason to consider using a well qualified real estate agent for all you home selling needs.
Knowledge is Power!