When reselling or flipping a property, setting an accurate and realistic price is vital. Market indications are important, but other factors come into play—especially when purchasing investment properties as-is.
Don’t hold on too long. Successful investors buy low and sell low. They don’t get greedy and they don’t try to swindle the buyer. However, if you set the price too low, prospective buyers may be wary that there is something wrong with it. On the other hand, if you price too high the property deal you’re trying to transact quickly may lag. It’s more likely to remain on the market longer than you’d like.
It makes good sense to go the extra mile and have an appraisal done on your property. Click here to read more about the appraisal process. The appraiser assesses market value by comparing your property to similar properties that are selling in your area. These are called comparables or comps.
Typically, reviewing comps and taking into consideration the property’s condition can provide you with pretty close to accurate information for pricing the sale property. An appraisal is an estimate of since two properties are exactly alike. The appraiser must make adjustments in the paperwork to make sure the features of the subject property and comps are in alignment.
While an appraiser can be a great asset to obtaining a fair asking price for your property, it’s always possible to get a little more, or a little less, than what the appraiser determines the value of the home to be. Keep in mind flipping or selling quickly is important as long as you don’t cut corners that will get you into trouble down the road.
Be thorough and perform due diligence. That coupled with an appraisal will help ensure you put as much money back in your pocket as possible while creating a win-win for all parties involved.