Property Grunt

Tuesday, March 14, 2006

FSBOS UNLEASHED: What's it worth?

After committing yourself to a fsbo you have to figure out how much to price your apartment. This a very tricky matter. Price it to high and no one will show up. Price it to low and you will rip yourself off.

The most common technique utilized to acquire a price is called "Comparables" or "comps."

Before I go any further I want to make it quite clear that comps are not an average price.

According the Fundamentals of Real Estate Appraisal

The appraiser collects sales data on comparable nearby properties that have sold recently then makes market derived adjustments reflecting individual differences between the subject and comparable. After necessary adjustments have been made the appraiser selects the resultant value idnicaiton that best reflets the market values of the subject property. As a formula, the sales comparison approach is

Sales Price of Comparable Property + or - = Indicated value of subject property.

For the ordinary person to get this data you have two basic sources. One is to call a broker and see if they are members of REBNY. If they are they will have acccess to R.O.L.E.X. which is the residential database of Manhattan Let them know that you are interested in selling your property and and want to see how much it would bring on the market. Ask them if they could give you a list of comps of what has sold on the market that fits your apartment.

This is a free service that brokers provide in hopes of getting an exclusive. Take advantage of it, however I do recommend that you do not make any promises to the broker if you decide to go fsbo.

Or you can talk to the main man Jonathan Miller and he can hook you up with some of his groovy appraisers and for a couple of bucks they can do a most triumphant appraisal of your apartment. This is will be probably more accurate since appraisers are trained for this type of work.

You should also look through the New York Times, Craigslist and other real estate sites to get an idea of what the market is offering. And exercise a little shoe leather by going to open houses in your area and talking to supers and doormen in your building to see what has been sold. This will give you an idea of where the market is going.

As you can see this is not rocket science. All it takes is a little effort to get the information you want. After you have acquired this data you couldput it into an excel spread sheet and figure out where you stand. It is up to you. Your main objective is to make an educated decision about pricing your apartment.