One of the trickiest things to do in today's real estate market is understand the (ever changing) value of a home. Not only is the economy changing as a whole, but each individual city seems to have it's own set of rules. Burbank is no exception. While I sometimes miss the mark of the value of a home, I find that homeowners typically fall into 3 categories:
- Totally confused, self-admittingly, as to the value of their home. I'd say about 15% of homeowners fall under this category.
- Totally wrong about the value of their home. A big chunk of homeowners I speak to fit in here, around 80%. Usually homeowners think their property is worth more than it is, but I occasionally get the cautious one who undervalues their home.
- Spot on about the value of their home. Unfortunately, I only experience this in about 5% of my meetings with homeowners. Why do I say unfortunately? Because if more people knew the value of their property, the less I would have to be the bearer of bad news. Note: don't kill the messenger!
I want to focus on the 80% that wrongfully think they know their home's value. Most of them look on the internet, which can be a great source of information when used properly. The internet can also be very misleading. For example, many real estate websites use price per square foot when estimating a home's value.
What is not considered in that formula are all of the short sales and bank-owned homes on the market, or the brand new construction selling in the trendy part of town, or the major fixer-upper that has been vacant for years on a busy street. When you average all of these, you get a fairly inaccurate home value estimation.
- Recently; in the past 0-3 months
- Under 1 mile away from your property
- With the same Bed/Bath count and comparable square-footage
- With similar upgrades/finishes as your Burbank property
This will help give you a better pulse on your local real estate market.