Northern Virginia Realtors

What is the Difference Between List Price, Sales Price and Appraised Value?

 

Bob: What is the difference between list price, sales price and appraised value? I want a Washington Monument looking upthorough and long answer please. I am thinking about buying a home in Reston Virginia.

Steve Bachman: Bob, the list price is the seller's current advertised price for his property. The price that the seller sets could be at, above or below the property's market value. In a buyer’s market, when prices are flat and/or falling and there's a lot of housing inventory available, you could reasonably expect to offer at or below the market value.

Bob: How does the agent figure out the market value? Can’t we just go with what Zillow says?

Steve Bachman: Bob, the market value of your Reston home of interest should be determined by your agent who will analyze the prices of recently sold comparable properties near that home, using what should be the “net” prices received by the sellers of those homes used for comparison. By “net” price, I mean that any seller’s subsidy or monetary help the buyer receives back from the seller should be subtracted from the published sales price of properties being used for comparison.

Key Bridge from VA into Georgetown, DC For example, if a comparable home sold for a sales price of $350,000 with the seller paying $10,000 of the buyer’s closing costs, the net sales price of that home is $340,000 not $350,000. Your real estate agent should be able to obtain and compile this data for you. It is a major part of her job.

Do not rely on Zillow estimates or the like, they are notoriously prone to error because those folks are not using the most current data and they cannot make adjustments for improperly recorded square footage or condition of the subject properties. In a tight market, every $5,000 makes a huge difference to you as buyer, and in our experience that is the closest that the public national programs can do…. usually they are more prone to error than that.

Bob: I have heard the acronym CMA. What does that mean?

Steve Bachman: It is a home pricing analysis tool that your agent should use to provide you with data you The Kennedy Center for teh Performing Arts will use to determine your offer price. It stands for Comparative Market Analysis. There is a CMA that most agents can compile from the local MLS in a relatively short period of time. These are very good for getting a “close” approximation of market value to use in comparing your homes of interest.

However,when you get down to writing an offer, if the properties that are being used as comparables are very different in style, lot size and square footage (this is often the case), the standard CMA may not be good enough.

Your agent should have the ability to do a spread sheet analysis using square footage records obtained from the tax records (which are often inaccurate and must be adjusted by experience) as well as provide you with a ratio of sold price to tax assessed value for all the properties being  evaluated for comparison with the home you are offering on.

Bike waiting for ownerThis can take hours for her to prepare since the data does not auto load from the county's tax records and everything needs to be double checked for accuracy. Once this is done, you will then be able to see what homes in the neighborhood have been selling for on a square footage basis as well as see how the net sales price to tax assessed ratio lays out for all the properties used in comparison. With this data at your disposal, you as  buyer will be well armed for negotiations.

Bob: Man, that’s a lot to remember.

 

Steve Bachman: Bob, don’t sweat it…good agents know how to do this. In fact when you interview prospective buyer's agents you may want to ask them to show you some of the spread sheet analyses they have done for previous buyers.

HA! That will sort them out fast, since no amateur or real estate hobbiest will know what you are talking C & O Canal locks in Washington DCabout.

As far as the last part of your original question regarding appraised value…..the appraised value is a certified appraiser's estimate of the worth of a property, and is based on comparable sales,  condition of the property, square footage and numerous other somewhat “subjective” factors. It is the basis for the mortgage lender’s valuation of the property and determines in large part what they will lend on a particular home. 

Bob: That was pretty thorough.

Steve Bachman: Thanks Bob, when you actually see a detailed CMA you will be pleased..they are very cool.

 

 

Why pay more and get less when selling your home? Jan and Steve Bachman of RE/MAX Gateway use professional photographers, create interactive photo floor plans, print full color brochures, and make an individual property website for your listing that goes out to 40+ public real estate search sites including Realtor.com, Trulia, Zillow etc.

 

We also create a custom photo tour that is sent to other agents and prospective buyers.

 

--------------------------------------------------------------------------------------------------

RE/MAX Hall of Fame, Platinum Club, A washingtonian Magazine Top Agent 2018

Happy to Help. No Hassle, No Pressure.

Jan and Steve Bachman are full time Realtors® with RE/MAX, specializing in Homes for Sale in Fairfax, Loudoun, Prince William and Arlington Counties.

 

 

       

Search for Northern Virginia Homes Like an Agent  Just play around. No hassle, no spam, we won’t bother you. Fresh listings emailed to you. Want more info. Drop us a line.       

 

We found our 2 rescue dogs through Petfinders. They're great!

Comment balloon 4 commentsSteve and Jan Bachman • December 08 2009 03:59PM
What is the Difference Between List Price, Sales Price and Appraised…
share
Bob: What is the difference between list price, sales price and appraised value? I want a thorough and long answer please I am thinking about buying a home in Reston Virginia. Steve Bachman : Bob, the list price is the seller… more
What do Full Time Realtors do All Day?
share
Joe: What do full time realtors do all day? I mean, since your clients work during the day…what do you do? Steve Bachman: We read termite reports…looking for that happy check box: “No visible evidence of wood destroying insects… more
Infant Aquatics in Fairfax County: Get your kids water safe now!
share
Sandy: We want to buy a house with a pool in Reston and are concerned about our young children's water safety. They have never had swim lessons since they are both in pre-school. Can kids that are so young learn much? Are there any swim… more
Special Needs Children: Adapted Aquatics programs in Fairfax County…
share
Karen: Do you think swimming or aquatic therapy is appropriate for my special needs kid? SwimteamAnswerman : Absolutely, positively without equivocation. In general, the swimming community is the most supportive group of families… more
Should I buy a home in Reston or Rent?
share
Should I buy a home in Reston or Rent? Tom: I want to buy a home in Reston but I'm pretty cautious about the whole thing. Is real estate still a good investment? Is renting a better idea? Steve Bachman: If you want to… more
Reston History. Where is the Reston Museum and is Beer available…
share
Visit the Reston Museum and then sit beside Bob Simon (Reston's creator) Reston History. Where is the Reston Museum? Barb : What suggestions do you have for how to spend a few hours on Saturday… more
Buying a Home in Reston? Video 2. More things to Consider.
share
Reston waterfront town homes. Lake Anne Charlie: What things should I think about when buying a home in Reston? I am planning on moving from Texas and taking a job near Dulles Airport along the tech corridor of 28 and the toll… more
What is a short sale? I have seen them in Northern Virgina. Should I…
share
The Warf off Glade Drive in Reston, VA. All homes are waterfront. and yes… there are short sales and foreclosures here periodically What is a short sale? Jim: What does it mean when I see the words “short… more
Video: Buying a home in Reston? Things to think about.
share
Sally: I want to buy a home in Reston. Are you providing me information in this video that is timeless, never gets old, and is applicable today and forever? Steve Bachman: Yes Sally. Just watch our home made video by clicking on the… more
Choosing a Reston Real Estate Company? Does it really matter?
share
Good Realtors. Where are they? Susan: We are looking for a good Reston realtor. Does it matter what brokerage company he or she is associated with? Steve Bachman: Yes and no. There are… more