THE MICHALSKI RESIDENCE
ACTIVE COMPARABLES—Shopping the competition
There’s no better exercise to nail your pricing, than to shop the competition. Having an intimate understanding of the other choices buyers have allows us to position your home at the appropriate list price to generate the highest offer possible under current market conditions, With that in mind, I’m always monitoring ALL the Active inventory a potential buyer has to choose from in the general price point and area we’re tracking, regardless of square footage, condition, amenities, etc.
Pending “Closest to” Comparables
After talking a wide-angle view of the Active inventory, the next step is to analyze pending sales via a more narrowed scope, as these represent the most current heartbeat of the market. Unlike Active listings, which may or may not be priced correctly, Pending Sales provide us the price at which a buyer found value and was willing to negotiate a contract for purchase. Although the contract price isn’t published until the property closes, it’s still a solid guiding indicator for proper pricing. For this narrowed scope, I’ve targeted homes that are similar to yours in terms of things like square footage, condition, amenities, specific neighborhood, etc.
Sold “Closest to” Comparables
Analysis of sold comps follows the same general process as the pending analysis…a narrowed scope to identify those homes that offered similar square footage, condition, amenities, etc. However, we need to give the most weight to recent sales. Something that closed this week, still usually represents an offer that was negotiated roughly about a month ago, as that’s the typical timeframe from contract to close. A sold comp from 5 months ago may appear to be a great comp initially, but could be marginal at best if the market has changed significantly. Whenever possible, I like to only include sold comps that have closed within the last 60 days. Unlike pending comps that are still in escrow, sold comps will show both the list price AND the sales price.