Last month I performed a listing presentation for a customer who wanted to sell his home. Located one block from the UNR campus, the property was typical of the older, cottage style homes in his neighborhood – an 848 sq. ft. two bedroom, one bathroom, single story house constructed in 1948. During our initial phone conversation this prospective client stated that he wanted the house to sell quickly and did not want to watch his property languish on the MLS for months. One of his biggest reasons for wanting to sell quickly was that he did not want to continue mowing the lawn any longer than necessary. I laughed when he said this, but, hey, it’s as valid reason as any other.
I should also mention that during our initial phone conversation the Seller said that he had been watching the homes for sale in his neighborhood and had already determined an asking price. He added that he was quite interested in seeing just how close the price I would suggest would come to his price.
The next day I completed the analysis of the neighborhood housing market, comparables and recent Solds. And armed with my pricing data I met him for the scheduled listing presentation. The presentation went well and we finally reached the point where the listing price is set. Usually, it is at this point when I ask the Seller, “So, given the current market data I’ve presented, at what price would you like to list your property?” I believe that if I’ve done my job properly, the Seller will usually choose a price that falls within my pre-determined price range.
The Seller answered my question with, “No, you go first.” Anticipating this response, I was prepared with my reply; “I believe $215,000 will generate the interest we’re looking for.” He thought for a moment. I waited for his response. He thought for a bit more. Finally he said, “Well, I was initially thinking of asking around $235,000…but after seeing what price homes are actually selling for, I think your price sounds like the way to go.”
We completing the necessary paperwork, I thanked him for hiring me and then informed him that his property would be listed on the MLS the following day. [see MLS #70010011]
That was a Thursday. By Saturday we had two offers on the table, as well as a third very interested party. One offer was an all cash offer close to my client’s asking price and the other offer was for full asking price. By Monday, less than a week after listing his property, the Seller had accepted an offer and was under contract. Today, only 28 days after listing his property, my client closed escrow for his full asking price.
My client will never have to mow that lawn again.
Reno Ignoramus
Guy:
Would you be willing to share how this sale stacked up against recent comparable sales?Will this sale elevate the comps in the neighborhood, lower the comps, or be neutral?
Thanks.
MikeZ
Good job, Guy!
Mike Van H
Wow Guy that’s great! Makes sense proper pricing is the key. Look at all the comments on this blog from out-of-towners who mention they’re just waiting for prices to lower to buy property in Reno.
Speaking of lawns, yard maintenance sucks, so time consuming. It’s tough to keep grass green. Now I know why people buy condos and townhomes.
Chris
Putting this stuff in my next home, definitely the way to go:
http://www.tourturf.com/
Reno Ignoramus
Again thanks, Guy, for the reminder that in today’s market its not so much location, location, location as it is price, price, price.
However, to know only that a house around UNR sold for $215,000 in a few days is not particularly helpful in assessing the current market. Having info about the context in which the sale occured would be quite helpful. So again my question. What were the recent sales that you relied upon to price at $215K? In relation to recent sales, was this sale above, below, or even?
GuyJohnson
R.I.,
Looking back at my listing presentation notes from last month I see that I found the following two properties to use as comps. One was 245 Bartlett Street. This is a 1,054 sq. ft. home, built in 1948, that sold for $235,000 (MLS #60008840). This property is not only very similar to my client’s house, but also is located on the same block. However, the sale of this home took place, almost a year ago, on 6/28/2006. Equalizing for the decline in sale prices since last June yields approximately $215,000 today.
The other comp I found was 525 Winston Drive. This 1,128 sq. ft. home, constructed in 1952, sold on 1/16/2007 for $205,000 (MLS #60023407). This house was slightly larger than my Client’s property and offered a third bedroom. However, my client’s property also had a full basement not included in the listed square footage.
As a quick check, five minutes ago, I pulled the Solds from the last 30 days in MLS area 119. Keep in mind that MLS area 119 encompasses a larger area than that immediately surrounding UNR. There have been 21 Solds in the last 30 days. The sale prices range from $68,800 – $372,000 with a median sale price of $179,000. Searching back through the past 90 days yields 45 Solds with a median sales price of $205,000.
In answer to your question regarding my client’s sold price’s impact on neighborhood comps, I’d have to say that our impact on the surrounding comps was neutral. We priced right on the money and got the results we were looking for.
Reno Ignoramus
Thanks Guy for the info. I appreciate the effort. One final question: what is MLS area 119? With 21 solds in the past 30 days at a median of $179,000, this area is substantially below the overall median, in fact about 45% below. Interesting.
DERRICK
OFCOURSE its below the median. Its not the greatest part of town. good location for students but this area is rather run down and isnt exactly the most appealing area in reno. Like every decent sized city in the U.S. theres always a section of town that tends to sell for less than the median.
GuyJohnson
RI,
Thank you for your questions.
MLS area 119 is called North Reno in our system. It is the area just East of area 120, which is called Northwest in our system. I realize this probably doesn’t tell you much, so I’ll attempt to describe the boundaries of area 119. Note: It may be best if you have your street map of Reno handy as I do this.
Area 119 is bounded…
On the West by: N. Virginia St.
On the South by: the Truckee River
On the North by: E Parr Blvd (west of 395) and Dandini Blvd (east of 395)
On the East things get a little convoluted. Loosely the Eastern boundary is El Rancho Dr (from Sun Valley Blvd down to I-80). Once you get to I-80 go West to 395 then South on 395 to the River.
I hope this makes sense.
DERRICK
while the homes in this area seem to be selling for alot less than the median (45% like RI noted) the price/sqft is over the median by quite a bit.. the house guy sold was for $250/sqft. Last I checked the average price/sqft was about $170.
Besides not being the greated area in town I believe the houses here also sell for less than the median becuase of their size.
alot of homes in this area are rather small in square footage and many are in need of some TLC. SO while many of the homes sell for less than the median these homes are raising the price/sqft at the same time.
2observer
In Sept 2005 I sold a home very similar to house being discussed here for $333,000. Two bedroom, one bath on North Virginia by UNR, built in 1940. Square footage slightly more. Took less than a week for it to be sold.
Reno Ignoramus, I always look forward to reading your posts.
245 Bartlett
I have been reading this blog for a while. In fact, this is how I chose Diane to list 245 Bartlett last year. She did a great job. I bought the house “fsbo” so our son would have a place to call home during his UNR days. I don’t care what a market looks like – if you ever have the opportunity to buy real estate close to a university while your darlings are in college- do it! I just wish I picked something up in San Diego while our daughter was there.