The Bahamas is in a seller’s market and many property owners want to take advantage of the opportunity. The big question is what is your property worth? The easy answer is that it is worth what someone will pay for it. Market comparisons are usually the most accurate way to determine this if you do not have an immediate buyer.
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If you are a homeowner in the Bahamas and you want to sell your property, determining the right value may help with your decision making. There are many factors that influence a property’s value and getting the right listing price is very fundamental to selling your home fast and for the most money.
An appraisal from a licensed appraiser can always help but they are expensive and even the professionals operating in a dynamic market can be off. The good news is, you don’t have to break the bank to determine your home value. With a little research, it is very possible to get the information you need to figure the highest price that your property will trade for.
The following steps are some easy ways to help you determine your home value.
- Find comparable properties
You can do your own research finding recently sold homes in your area and compare their prices. Look for listing market data of homes similar to yours in order to make an estimated fair market value of your home. You can contact one of our advisors to get a list of sold properties in your immediate neighbourhood or comparable neighbourhoods.
Your comps should be guided by homes with similar features. Pay attention to home size and age, recent upgrades, location, and the overall home condition. If you are struggling with comparative market analysis data sources, you can contact one of our advisors for accurate sales data from your neighborhood.
- Analyze the data
Analyzing sales data and market trends will help you find out the factors that are driving property prices in your neighborhood. You will be able to forecast the local real estate market and estimate your home’s value. By researching and analyzing data, you will be able to make an informed decision whether it’s the best time to sell your home or not.
If you can not find similar homes with criteria identical to yours then the best metric to employ is a price per square foot. An example, if the house next door sold for $475,000 and it was 3000 square feet then the square foot selling price is $158.33. Of course, features like pools, landscaping, age and yard size all have to be factored in and it is important to remove any personal biases for any properties, particularly your own – owners almost always think “mine is better”.
- Compare “apples to apples”
For an accurate estimation of your home value, a comparison must strictly be done by selecting similar homes in your neighborhood. Comparable homes should have very close similarities in terms of features such as; home type, square footage, amenities, bedrooms, bathrooms, age, upgrades, location, and outdoor spaces. Also, the more apples in the comparison, then the more precise your research findings will be. Four houses in the $150’s per square foot would be a very consistent group of comparisons to work with. A range from $100 to $250 is more challenging and should be analyzed in more detail and you may consider discarding comparables with too many dissimilar features. If yard size, or finished materials such as impact windows vs. jalousie windows, or Bermuda roof vs. asphalt shingle are differentiating factors then all of these variations need to be considered.
- Arrive at estimated home value
Once you have identified your most appropriate comparable properties, start by comparing their actual sales price. Divide the sales prices by their square feet and get the average of three to four similar homes. Incorporate a hybrid of land and home where there are excessive variations.
You will then use these figures to compare with your property’s square feet to determine an estimated fair market value. It’s very important to put in mind the differences that you identify between your home and the comps, as this could have a bearing on the overall home value. Back to the example in number two, if your personal property is similar in features but slightly smaller at 2700 square feet then you can apply the square foot price and arrive at a possible value of $427,500 (rounded off). Use an average when multiple comparables are used.
Engel & Volkers advisors are available to help you with the information you need and any guidance or advice along the way to determine both the value and whether it is the right time to take advantage of an active market..
