How much is your home really worth?

How much is your home really worth?

Canberra’s property values haven’t been subject to the same declines that have hit capital city housing markets in other parts of the country – thankfully. Signs have emerged signalling that the worst of the national property downturn is over, and although this had little impact on Canberra’s property prices, is great news for those in the ACT looking at buying and selling property.

As 2019 draws to a close, and with summertime being one of the most popular periods for homeowners to list their property for sale, you could still get your home sold quickly and at asking price. To accomplish this, though, what would you need to do to?

A) Stage your property
B) Hire the right real estate agent, or
C) Price your home competitively

All the above are crucial to an expedient and successful sale, but before a potential buyer even inspects your property or speaks with an agent, they’ll be weighing up the price tag. Why? Because buyers are wary of overpricing, often have a strict budget to work within and have greater access to online tools and data than ever before. Although many buyers are willing to stretch their budget between 5-10% for a home perfectly suited to their needs, they’re cautious about their investment falling into negative equity if market conditions end up worsening long term.

Whilst negative equity isn’t such a problem here in Canberra, buyers are still fixated on finding the right home, at the right price, and are much more likely to make an offer if the price is compelling.

It’s in your best interest as a seller to see to it that your home is competitively priced, and to choose a real estate agent that will help you accomplish this.

What’s the right price?

There are techniques to pricing a home so that both you and the buyer gets what they want.

So, what do you want? To get a fair, market-related price on your home. Buyers want the same thing; they want to feel confident that they are paying a fair price. Where things can get tricky is in deciding what exactly “fair” is. We’ve outlined some simple steps you can follow below, in order to determine what that price may be.


Step 1: Research the current property market

One of the first things you learn in any economics class are the laws of supply and demand. As demand for a property increases, so too does price – until an equilibrium for both is found. Oversupply has an opposite effect on price; prices decrease as more supply is added to the market. When looking for similar homes it’s important to compare apples to apples, meaning properties on a similar sized block with a similar number of bedrooms, bathrooms and vehicle spaces and ideally a similar set of features.

Keep in mind that buyers will probably be inspecting other properties in the same price bracket and suburb and then comparing them against each other. This is where the overall presentation and condition becomes especially important. A fresh coat of paint and some simple landscaping can make a big difference, which you can learn more about in our guide to getting your home ready for sale.


Step 2: Compare the sold price to the listing price

Just because a property was advertised at a certain price, doesn’t necessarily mean it sold for that same amount. When dwellings start selling above or below the asking price en masse, it’s usually an early indication of the market undergoing a correction. One of the best ways to determine what homes are selling for is by regularly checking the weekend auction results. You can also view past sales data, but keep in mind that these figures may not get updated until 3-6 months after settlement as government data often takes a while to become available.

 If you want to get a fair market-related price for your home, you should pay close attention to the final selling price of homes on private treaty and homes that have been auctioned in the last three to four months. This will give you an accurate figure with which to base your expectations around how much your home will sell for.


Step 3: Work on a deduction strategy

After researching the competition and creating a list of similar properties currently on the market and those recently sold, your next step is to analyse how your home stacks up in comparison. One of the best ways to do this is by working on a deduction strategy. This means that instead of adding to your home’s price for every unique or value-added feature, you subtract from the price based on every feature the property lacks in comparison to others on your list.

 Swimming pools are a great example; families on a good income with children (and love to entertain) are probably attracted to a feature like this – but that same pool might completely turn off a property investor who sees the ongoing maintenance as a hassle and unwanted expense. There are several other aspects to consider but this basic principle will give you a realistic view of what buyers are willing to spend on your home.

 While it’s important to have a solid understanding yourself, it pays to have an experienced real estate agent walk you through the pricing aspect. It’s hard to understand how much “worth” buyers place on each specific feature – and even harder to judge your property without bias. An experienced agent has an insider’s perspective into features that different types of buyers desire most and will help you to understand the true value of your residence.

How much is your home worth?

Use our “Big Data” tool to get an estimate of your home’s current value in less than 90 seconds, based on statistics provided by one of Australia’s leading data providers.

Step 4: Set firm expectations

Now that you have a clear idea of your competition and where your property stacks up compared to others in the neighbourhood, it’s time to set firm expectations. There are 2 important questions that you need to ask yourself:

1) What is the lowest offer I’d be willing to accept for my property?
2) What is the highest price my home could realistically sell for?

Having clear numbers in mind for both the best and worst-case scenarios will give you clear targets to work toward. With clear expectations you’ll also be able to have more productive discussions with the real estate agents you decide to speak with, as they’ll be able to provide advice on the best marketing and sales strategy for your goals.

Step 5: Get your home Digitally Appraised

With clear expectations firmly set in place and enough information to move forward, it’s a good idea to get your figures double-checked by a professional. One of the easiest ways to do this is with a Digital Appraisal, where a local agent can use various sources of data to assess how much your home would likely sell for in Canberra’s current market.

For instance, using our Instant Online Estimate & Free Digital Appraisal service you’ll be able to get an instant ballpark figure based on “Big Data” provided by CoreLogic – Australia’s leading provider of property statistics and data – which will then be followed up with a comprehensive Digital Appraisal within 24 hours. Unlike the instant estimate, this Digital Appraisal is manually calculated by Peter Tolhurst, the agency principal and founder of Real Estate Australia, who’s spent more than 25 years specializing in residential sales inside of the ACT.

Step 6: Have your home assessed in person

Even though a Digital Appraisal will give you a good indication of what your home is worth, it’s only once you step through the front doors and get a feel for the atmosphere that you truly know what a property is likely to sell for. During an in-home market appraisal, the agent will look at everything from the layout and style of the home through to the condition and features it provides.

 After assessing the physical aspects of the property, they will then do a thorough analysis and provide you with a formal market appraisal – which will provide you with the range they confidently believe you’d achieve should you decide to list for sale.


Preparation is the key to successfully selling your property

So while Canberra’s property market has seen a small drop in value over the last 12 months, getting a great result on your sale is 100% achievable, so long as you price your home competitively. Summer is just around the corner which, when combined with the enticement of lower prices, is sure to bring droves of buyers to the weekend open homes.

If you’re thinking about getting your property on the market in time for peak season though, now is definitely the time to start researching and preparing. Having a clear understanding of the market and where your home sits among the competition will allow you to have an open and frank discussion with your chosen real estate agent. Depending on your desired goals, they’ll also be able to give valuable advice on what you may need to fix up and tidy (we list lots of great tips in our guide on getting your home ready for sale) before you go to market.

And remember, the sooner you start preparing your home for sale, the better your final result is going to be!

If you’re considering selling your property, why not speak to one of our senior agents? Our agency principal, Peter Tolhurst, has over 25 years experience and would be happy to perform a free, no obligation market appraisal at a time that suits you.

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How much is your home worth on the market in Canberra?

Use our “Big Data” tool to get an estimate of your home’s current value in less than 90 seconds, based on statistics provided by one of Australia’s leading data providers.