The real estate market is still shaking. New data suggests that home prices have hit a new record low. In every new study that comes out, homeowners from Miami, to Las Vegas, Phoenix and Los Angeles, have seen their home value go lower every time.
Is that disappointing? Of course it is.
Should we sell? Is not a good time.
Should we stick to it? Yes, if you can.
Have we hit bottom? Nobody knows.

Banks are facing their worst foreclosure crisis.
Don’t take me wrong, it’s good if you are in the market to buy a home for yourself or if you are an investor, but if you are not, and you own a home, most likely the value of your property is down at least 15 %.

Why do banks care if you are loosing your home? By having to sell repossessed homes, banks have to literally slash their prices down. It gets very costly for them, after all, they have to pay property taxes, maintenance costs, and whatever utilities that need to be paid, all of this expenses for a house that it’s just sitting there, vacant, and the bank is getting nothing in return.

The latest study by the S&P/Case-Shiller Home Price Index of 20 cities, revealed the news that for 22 consecutive months home prices dropped. Only from April to May, 2009 the decline was of 0.9 %

Mr and Mrs Home seller buys a home in 1995. $150,000.

Last year, a CMA resulted a value of $595,000. Now, 12 months later they want to sell. They believe their home is worth at least $595,000 if not higher.

They use the online valuations and they get a spread: $395,000 – $695,000.

Several Realtors CMA it between $535,000 and $575,000.

The result: Chaos. Confusion.

Now a series of agents come and some agree to list it for whatever the seller wants just to get the listing and others will try and be more professional and keep it within a range that makes sense. Meanwhile the home sits for months and months are they are in many destinations all the while it's overall value continues to decrease because it was never priced right to begin with.

Are valuations systems helping, hurting, thoroughly confusing or illustrating a deeper dysfunction within real estate?

Is it entirely possible that maybe the only way to properly list homes today is to use online valuations to get an idea but list it with a starting bid price of $100.00 that engages buyers like eBay and see what the market bears?

Silly as it sounds, where I live, nothing is moving, homes appear to be priced way to high and the consumer seemed overly perplexed.

Next time an agent sends you a market analysis that sites sold comparables, ask the agent to tell which of those comparables that they have personally seen inside and out.

Some would say that a market analysis should be completely numbers-based and that seeing the properties ground level is not relevant to market value, but I disagree. When I present a market analysis based on comparables that I have seen first-hand, I am stubborn and vehement about my pricing recommendation.

This is not an easy thing to do since, by definition, the comparables will no longer be on the market and cannot be toured with a lockbox key. However, there has to be one agent in your market who previews every home that goes on the market so that he can know your neighborhood better than anyone else.

You call that guy or gal and you will know what your home will sell for.

I have to say that I am one of those Joe Blow’s sitting with an interest only investment that will adjust next year in Ca and I’m clueless as to what to do with it. It begs the question for many Americans, who is an expert and who can they trust?

You should also tell your audience that there are only 53 Single Family homes for sale in San Luis Obispo between the price of $700,000 and $1,000,000, and that San Luis Obispo is among the top 100 most desired places to live on the planet.

If you restrict your search to only show homes over 2000 square feet, there are only 26 available homes.

Your local REALTOR who knows the inventory probably knows that many of the listings between $700,000 and 850,000 are not as nice as your home. Knowing you, I suspect that you home is more than 2000 sq ft and is nicely pimped out!

I would suspect that if you listed it at $700,000 you would close in 10 days and likely sell for over listing price. If you listed it at $1,000,000 you might be on the market for 250+ days and end up taking a lower offer.

We are in the industry and are bemused by all of these opinions. The average consumer who moves every 7 years must be in total shock.

The value of any home is exactly equal to the price someone is willing to pay at the exact time that you agree to sell it.

However, where the rubber hits the pavement is that ‘buyers buy by comparison’I like to say, whether it’s ‘cars, toaster, houses, spouses’. So your ‘guiding light’ in pricing is to get inside the mind of your target buyer. To do that you have to physically ‘see’ the competing properties and become familiar with the ‘tradeoffs’ that a buyer would likely employ in looking in that market segment. So it’s not just ‘solds’ but ‘actives’ that playespecially today when you could be below the sold comps and not sell for reasons you’d never get to without an analysis of the active competition. Add to this a solid knowledge of the amenities and idiosyncrasies of the area. For example, in one of our communities the properties closer to the community center with its amenities tend to sell more quickly and for more. The point is you would probably never get to that without experience in that market. It doesn’t show up in the data per se!

I could go on. Bottom linethere is a range that’s within 5% that your house will sell for. And that range can be established with some confidence by agents that know what they’re doing. One thing for sure, you can’t get there just on paper with any confidence visa vi a Zestimate or an agent that doesn’t do a thorough job of the field work.