P4
Appraisal
Corner
As an impartial source
of information about properties, the professional appraiser
is trusted by the financial industry for its evaluations of
involvement.
As a member of a self-governing
body, the professional appraiser has agreed to adhere to the
strictest standards of ethics.
It
is unethical for an appraiser to accept compensation for
performing an assignment when it is contingent upon:
1.
the reporting of a predetermined result (e.g., opinion of
value);
2.
a direction in assignment results that favors the cause of
the client;
3.
the amount of a value opinion;
4.
the attainment of a stipulated result; or
5.
appraiser's opinions and specific to the assignment's purpose. When selecting your appraiser,
make sure that you have been provided with professional
credentials that will protect you, your lenders and your
purchasers.
For further information,
please contact Paul Lowe, Appraisals Manager, at (242)
322-1041, or by email at: paul@HGChristie.com
Have something you would
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us know!
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Christie Great
Estates
Annual Conference
 Chicago
was the location of the Christie's Great Estates Annual Conference
October 19-22, 2003, and H.G.
Christie was in attendance.
Read about the Conference here...
Set
the Sales Price that Sells
 Sometimes
a property sells literally overnight, and other times, properties
will be on the market for months. There
is a logic to setting the sales price.
This article
explores a relationship between all the pricing factors that
will make every seller
a winner.
A quick quiz - what is the perfect selling price? 1. the price that makes you money on what you paid
2. the figure that makes the property move quickly
3. the number that the buyer thinks is a good value
4. a fair market value If you said any one of these, give yourself
a point. If you said all of these, congratulations. You are
on your way
to a well-organized sale. Some of the market conditions that make the job a little
easier include extremes of the market, like a buyer's market,
or seller's market or some economic condition that creates
a sense in the buyer's mind as to value. Unfortunately, these are rare situations, and usually the
market tends to moderate itself, balancing supply and demand
into a narrow band that is dependent on physical condition
and neighbourhood. To set the fair market value, it is often advisable to work
with your agent and an appraiser to determine what the highest
value a well-informed buyer will pay. A competitive market
analysis undertaken on the property will become a strong
tool in helping assess the fair market value. However, fair
market value is still not generally the asking price. If the market is strong, you will want to slightly overprice,
knowing that the motivated purchaser will come in with an
offer usually a few points less than asking price. If the
asking price and fair market value are close, the buyer and
their advisors will sense a deal, and will be able to easily
justify making their offer. However, some decision criteria in setting asking price
seems to encourage the seller to want to increase asking
price beyond a realistic point. These are conditions such
as where recent upgrades where the seller feels they must
recover 100% of investment, the need for cash, where the
seller is also purchasing, and usually in a higher-priced
neighbourhood. Asking price can also be set too high in reaction to paying
too much when they purchased, when the seller wants to create
negotiating room, and for one of the most likely reasons,
lack of comparative information about the market value. All in all, most of the time the market
favors the buyer, and as a rule of thumb this will mean that
the asking price
should not exceed the established market value by any more
than 1 to 3 percent. Anything higher, and your pricing strategy
will begin to backfire. To sell, you must be able to show, and
a well-set sales price virtually guarantees showings. In conclusion, get a reliable market price,
listen to your advisors, and don't listen too much to those
little voices that
tell you that you can always get more. The relationship between
market value, asking price, most favored purchase price -
and the final selling price - is well-known, and you may
as well use it to your advantage.
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