What’s The Value Of Your INHERITED Property?
This is Brad from probateresource.com. At Probate Resource, we specialize in real estate solutions, particularly in the world of probate and inheritance properties. Across the United States, we purchase properties for cash and maintain an exceptional network of real estate agents who are experts in probate and inheritance sales, ready to assist you in selling your property.
Today, I’d like to discuss the topic of determining the value of your house. Oftentimes, families or estates approach us without a clear understanding of their property’s worth. While they may reference Zillow’s estimates, it’s important to approach them with caution. Although sometimes accurate, Zillow’s valuations can also be quite off base. In neighborhoods with similar, uniform properties—where houses share comparable features like size, style, and layout—it can be easier to gauge the value.
Zillow is usually quite accurate but it cannot see the condition of the house.
Zillow’s algorithm only works with square footage, bedrooms, bathrooms, and other comparable sales data in the neighborhood. It does not consider the pictures, condition, or upgrades of the property. Therefore, it is not always accurate and should be taken with a grain of salt.
To determine the actual value of a property
It is best to follow the approach used by real estate agents, brokers, and appraisers, which is to look at comparable sales of houses that are similar in size, age, and condition. You cannot compare a 1,500-square-foot ranch built in 1965 that has never been upgraded since then and still has shag carpet with other properties. It is not fair to compare two different properties that are vastly different from one another.
For instance, a four-bedroom, three-bathroom, two-story traditional house built in 1995 with a basement and two-car detached garage located half a mile away is not comparable to another property. Similarly, a brick ranch built in the 1960s, a few blocks from your place, that has been completely renovated with updated kitchens, bathrooms, and hardwood floors throughout, a new roof, new HVAC, a finished basement, and a swimming pool is also not comparable.
How Appraisers Compare Properties
Appraisers compare properties that are alike in terms of features, conditions, and amenities such as the number of bedrooms, bathrooms, and other similar factors.
Appraisers make adjustments for differences in sales by finding comparable sales, or as close as possible to comparables. Sales must be recent, preferably within the last six months, to stay in the same market cycles. Market cycles change over time, and in the last 12 to 14 months, the real estate market has contracted considerably. Houses that sold for a certain price two years ago may sell for a completely different price today. The market has slowed down significantly as interest rates went up, causing prices to pull back a bit. We are now selling properties for less than what we had originally anticipated due to the market’s adjustment. You may have seen some headlines about this.
Market Trends
The news headlines about the real estate market tend to be outdated by about six months or more. The information that’s being reported today is actually about events that happened half a year ago. The media is not always up to date, and the market can change rapidly. I’ve seen it happen in as little as a month. One example of this happened just three weeks ago when interest rates were as high as 8%. However, rates started to come down a bit, and suddenly properties that had been sitting on the market with no activity or showings for weeks began to attract attention again.
It’s worth noting that the properties we were selling were priced competitively and had no issues with their appearance. We made sure to fix everything that needed fixing, staged them beautifully, and took great photographs. However, the market rates were so high that buyers were deterred from making a purchase. After a while, when the rates came down slightly, we started receiving more showings for our listings without making any changes to the listings themselves. We eventually managed to get one under contract and it’s closing next week.
This phenomenon is not uncommon in real estate. Appraisers rely on the most recent sales to determine the market value of a property because they’re the most indicative of the market’s current state.
It’s possible that the property appraisers might go further back in time, say up to a year, to find comparable properties. However, they would prefer to stay as close as possible to your property, particularly within your neighborhood. If your property is located in a subdivision or a neighborhood, they will try to find comparable properties within the same area since it’s likely that houses in these areas have similar features. If there are no recent sales in your neighborhood, they might look at properties within a mile radius that are similar to yours and make adjustments accordingly. They will take into consideration the amenities, access, and other factors that might affect the value of your property.
Property Assessment
When assessing the value of a property, certain factors are taken into account.
For instance, if your house is located right next to a highway, it will be worth less than a house that is located a quarter mile away from the highway. Similarly, if your house is situated on a busy street, the value of the house will be adjusted accordingly. The condition of the house is also taken into consideration. If your house is outdated and lacks modern updates, then it will be deemed functionally obsolete and its value will decrease. Additionally, if your house is in disrepair and requires extensive repairs, its value will decrease as well. When comparing the value of your house with other houses in the neighborhood, you should take into account the renovations and updates that your neighbors may have made to their houses over the years. A property with outdated features such as shag carpeting cannot be considered comparable to a property that has undergone significant updates and renovations.
It’s important to consider various factors when assessing the value of your house, such as the sales of other houses in the neighborhood. Sometimes people think their house is worth more because they have unique features like a fountain in the backyard that cost a lot of money to build. However, such features may not necessarily add value to the house unless there is a buyer who is interested in them. For instance, if a potential buyer doesn’t like the fountain, they won’t put any value on it, and it won’t increase the value of the house. Swimming pools are another example of such features. They can either add or detract from the value of the house, depending on the buyer. Some buyers may see a swimming pool as a burden because it requires maintenance, while others may view it as a safety hazard if they have young children. On the other hand, some buyers may really want a swimming pool, and they would be willing to pay extra for the house because of it. In summary, it’s essential to assess the value of unique features in your house from the perspective of potential buyers and not just based on what you think they are worth.
Buyer Wants & Needs
It’s important to keep in mind that if you’re selling a property, it needs to be similar to the other houses in the area. For instance, if you’re in Florida where it’s very hot, many people have swimming pools in their backyards. If your house doesn’t have a pool, it might be appraised for a lower value than your neighbors’ houses. This is because the houses in the area need to be homogeneous, or similar to each other. If your house is very unique, it might be appraised for a lower value. However, you may still find a buyer who loves your house and is willing to pay you cash for it.
When you’re selling a property on the market, it’s important to appeal to the broadest amount of buyers possible. This is why many people use neutral colors and decor when staging their homes. Neutral colors and decor appeal to a larger audience, which can lead to more potential offers and a quicker sale.
If your house is very unique, you may have to wait a long time to find a buyer who appreciates your style. This is because some people may not like your unique taste, which can make it difficult to sell your house. Therefore, it’s generally a good idea to neutralize your property to appeal to the largest audience possible. I’m sure the previous owners spent a lot of time and effort painting these walls. They loved it and it was great for them. However, the next buyer might not appreciate it and might not see any value in it. So, if you’re trying to sell a property and appeal to the broadest amount of buyers, you need to neutralize it.
A Smoker’s House
Please clean it up and make sure it smells nice. I want to give you a piece of advice. We often encounter properties that have been smoked in, and it can be not easy to sell them. If you have a house that’s been smoked in, you need to lower its value. Cigarette smoke can be unpleasant for many people, and it can be costly to remove the smell.
It can cost thousands of dollars to remove the smell of cigarette smoke from a property. I remember a property I bought a few years ago. It had been smoked in for years, and it was difficult to get rid of the smell. I renovated it and sold it to a young couple. Now, they have listed the property for sale again.
That house used to belong to a smoker and it was very challenging for us to remove the smell of smoke from the house. We had to use oil-based KILZ to paint the walls, bring in air scrubbers and wash the walls with soap multiple times to remove the tar. We even had to clean all the duct work and replace the air handler because the smoke smell had seeped into everything in the house. We also had to prime the insides of the cabinets and drawers to eliminate the smoke smell.
It’s very difficult to get rid of the smell of smoke from a house, and many buyers are put off by it. If you have a smoker’s house, I would suggest reducing the price by $10,000. It’s important to keep in mind that many potential buyers might walk into the house and immediately turn around and leave because of the smell, even if the house is beautiful. This could significantly reduce the number of people interested in buying the house.
It’s essential to address any odor issues, such as mold or mildew, before putting the house on the market to avoid potential buyers being put off. People are often deterred by unpleasant odors, strange colors, and other oddities in a house.
Property Issues
Additionally, a certain amount of disrepair can also be a turn-off, especially if the property requires significant repairs like a new roof, HVAC system, or has cracks in the foundation. Even if these cracks are minor and have been evaluated by an engineer who confirms that they are just settlement cracks, some buyers may still run away from the property, fearing a foundation problem. Other factors that can affect the value of a property include power lines and other external elements. If you’re trying to sell a house, it’s best to consult a real estate professional to get an accurate opinion of the property’s value.
Let’s Connect
If you are not interested in spending time and effort in cleaning, fixing or preparing your property for sale, you can reach out to investors like us who are willing to make a cash offer. We often buy properties that are full of stuff and don’t need any fixing. You can take out your important belongings and leave the rest of the items that you don’t want behind. We do that all the time. However, if you are planning to sell it through an agent, you need to get it ready for sale and make sure it is presentable. You should clean it out, clean the yard, and fix any issues if you want to sell it at a higher price.
If you plan to sell it as a fixer-upper, then you should price it accordingly and not expect the same price as the house down the street that requires no fixing.
I understand that the video was quite lengthy, but the subject is quite complex and cannot be simplified. We often receive calls from people asking about the value of their property and what we can offer them. However, we cannot provide an accurate estimate over the phone because we haven’t seen the property in person. Some real estate investors might offer you a price without even seeing the property, but from my experience, those offers are usually not genuine. They are planning to modify the offer they made to you. It’s like a bait-and-switch tactic, luring you in with a seemingly attractive offer, but then when they inspect the property, they will most likely reduce the price by $30,000 to $40,000 for various reasons. Even the large online companies that claim to buy houses instantly often follow the same strategy. The offer you receive on their website is usually not a genuine one. In fact, over 90% of the time, the actual buying price is lower than the amount they offered online. I have been in this industry for years, and I can vouch for this truth.
Again, this is Brad from probateresource.com. Our company believes in providing a fair and honest evaluation of your property before making an offer. We don’t believe in misleading or wasting your time. If you are interested in working with us, you can visit our website probateresource.com, and fill out the form available there or call us directly. We can buy your property for cash or connect you with our probate inheritance real estate agents who specialize in your specific market and can help you sell your property.
Thank you for watching this video.