One of the first questions my clients ask is How much is my Hopkinton home worth? This is tricky, because there are so many factors at play: the location, current market conditions, recent sales of similar properties, and the features and condition of your home all affect the value and how we price it. Striking a balance is critical: We don’t want to price it so high that buyers disqualify it, but we don’t want to leave money on the table either.
The first place I start is by evaluating the data. I look at the homes that have sold recently, and depending on the property, I may go back several months or even up to a year. I also look for homes in comparable neighborhoods, knowing no two homes are going to be the same. One of the most important factors to consider is the appraisal; the sale price of the home has to match, or at least come close to the appraised value. Most buyers will take out a mortgage to purchase the property, so the home has to appraise properly for the bank to lend the money.
But looking at the data itself isn’t enough. I consider other factors, such as the date of the last remodel and the age of the roof to determine the price. It’s important to dive deep into each comparable property, and if your home is a little better in one area that’s a plus-one for you, or a little worse in another it’s a minus-one. I ask What does this house have that comparable properties don’t? and make a recommendation based on that.
Location is an interesting factor, particularly in Hopkinton. There is no “bad” side of town where we live, so some of the things I consider are the proximity to the highways (where the road noise may be louder) or if it’s near one of the gun clubs (we have 3 in Hopkinton). A big driver of value is whether the property has a level and usable back yard. Many buyers find this feature attractive, particularly those with young children.
Many clients use Zillow as a reference for their property value, but this is misleading in almost every case. Zillow is an algorithm, and doesn’t take into consideration the nuances of your home. It doesn’t know the age of your kitchen or appliances, or the condition of the roof. It simply takes previous sale data, square footage, lot size, and a few other factors and computes a value. Zillow’s Zestimate is not market-driven, it’s a computer program. In fact, if you check out Zillow’s website, you’ll see this disclaimer:
”The Zestimate® home valuation model is Zillow’s estimate of a home’s market value. The Zestimate incorporates public and user-submitted data, taking into account home facts, location & market conditions. It is not an appraisal and it should be used as a starting point. We encourage buyers, sellers, and homeowners to supplement the Zestimate with other research such as visiting the home, getting a professional appraisal of the home, or requesting a comparative market analysis (CMA) from a real estate agent.”
Something else that helps my clients is to understand the costs to improve the areas of their home I think buyers are likely to have concerns about. For example, if the roof needs repair, I’ll gather quotes from reliable contractors and have them ready to share with potential buyers, noting that the issues have already been factored into the listing price. This saves a lot of back and forth and accelerates the closing date.
I recommend you follow these steps to calculate the value of your home:
- Start by building a list of recent home sales in Hopkinton. Narrow it down to properties that match your home in terms of age, approximate square footage, lot size, and proximity to desirable services (like schools).
- Eliminate the properties that don’t have a comparable number of bedrooms and bathrooms, and also ensure that the homes were built around the same year as yours. If your home needs to be updated, don’t compare it to a home that has been totally remodeled. Don’t worry about heating or water source as these rarely come into play for buyers.
- Build a spreadsheet with several columns, including address, sale price, square footage, price per square foot, bedrooms, bathrooms, etc. Create a row for each of comparable property. Then, for each of the following items, indicate if your home is more or less desirable than the comparable property:
- Mass Pike and I-495 noise. This can reduce desirability for some buyers.
- Usable lot size. A level back yard is very desirable for families moving to Hopkinton.
- Proximity to desirable services (schools and shopping, for example).
- Approximate age of kitchen, bathrooms and appliances
Evaluate your findings. On balance, is your home more or less desirable than the comparable properties? If more, your house is likely worth more.
I use a program that takes these attributes and many more into consideration when pricing a home for my clients, but the method above should give you a good start in determining the approximate value of your home.
Thanks for reading! Next month I’ll share some of my best tips for staging your home and getting it ready for sale!
Trina Macchi is the Team Leader at The Macchi Group of William Raveis Real Estate, based in Hopkinton.