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With so many working parts in the market and economy, how is an evaluation possible?  It’s possible if you answer this question:  “What’s the Best Prediction of Future Performance?”  If your answer is something like: “Past Performance,” you’re correct.   History can tell us a lot about the future.

 

REALTORS use the Multiple Listing Service (MLS) to promote (to other REALTORS) those homes that are on the market for sale.  Throughout the home buying / selling process they are required to change the “status” of the transaction.  The home is listed “Active” followed by  “Contingent” then “Pending” and finally, “Sold.”

 

They also use the MLS as a massive repository of historic market data.  Putting the pieces together is all that’s necessary to begin estimating  the value of a home.

 

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Axioms are statements or propositions which are regarded as being well established, accepted or self-evident.  We’ve already discussed one in real estate:  Supply and Demand.  If we could statistically plot the two curves they would cross, or intersect, at the equilibrium point. That point where supply and demand are equal.

 

Another axiom is the 80/20 Principle, first observed by the Italian economist Vilfredo Pareto (1906).  Simply put it means 20% of the effort or action produces 80% of the results.  There are many, many examples in life, and too numerous to list here.

 

The 20% is absolutely essential; whereas 80% is almost unimportant.  Make no mistake the 80% is never to be completely ignored. A buyer’s decision to make an offer to purchase, and for how much is guided by the 20%. Therefore it is the result of 20% of features; routine or special maintenance; cleanliness; staging and other terms involved.

 

What all this means is that this axiom can save you time when selling your home, and for top dollar (list price or above).  Therefore, highlight special or unique features of your home (20%) rather than trying to highlight everything (80%).  I’m reminded of a sales axiom that we used to instill in all our salespeople and marketing managers:  “If you don’t distinguish yourself from the pack you’ll always be just one of the pack.” The would be buyer that might decide to make an offer, (and for how much) may be “blurry-eyed” from looking at multiple homes.

 

Ask yourself, “is every 3 bedroom/ 2 bathroom exactly alike?”  The answer is “no!”  So, why then, should any buyer offer you list price/higher?  Where’s the uniqueness? This could include things like: 

 

• lot size, double lot, corner lot,

• health of the local economy, 

• school system State rating, 

• real estate tax rates

• Age of the home and reputation of the builder, maybe yours was the model for the development (which is typically finished with greater care or is slightly larger than others built). 

• maintenance done to furnace - air conditioner – water tank - 

• This is particularly important if you do (or plan to do) any remodeling or make additions to your home.  Even if you haven’t remodeled you can often boast of “move-in ready” by applying a fresh coat of paint (neutral colors please) to walls and some woodwork.  

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It is also terribly important to attract prospective buyers via the MLS or social media silos.  Any seemingly “ordinary” home can be made to be memorable. At the very least you will enhance the “saleability'' of your home (sell more quickly, and for a higher offer/sales price).