Many property owners look at their home’s value on websites like Zillow, Trulia or Realtor.com, but can those valuations be relied on? These sites use Automated Valuation Models (AVMs), which have become more common but often don’t reflect the true value of a property. Realtors and appraisers analyze a property based on recently sold homes that are most comparable to the subject property. Adjustments in value are made accordingly, based on differences in square footage, condition, number of bedrooms/bathrooms, age of construction and other amenities. In a homeowners association, using sale comparables from the same development is often the best way to determine value due to the similarities of the homes being sold. However, even within a HOA various factors can dictate substantial differences in value. This was brought to light when a client recently asked why the value of a neighbor’s condo was over $100,000 higher than theirs (on Zillow), yet was almost identical. The likely reality is that the value of both properties were pretty similar and that Zillow’s valuations were off substantially. If you want a realistic expectation on the value of your property, your best bet is contacting a REALTOR, because they know how to identify the factors that can swing value. Some of those factors include:
- Location within the development: If a property borders a busy street, highway, train tracks or an industrial area, it will likely sell for less than that same floorplan which is in a cul-de-sac location or next to green space. Additionally, some parcels within a development offer better views or more usable space as a result of the home’s orientation on the lot.
- Renovations: AVMs don’t know whether or not a property has been updated, but buyers certainly do. Properties that are nicely upgraded appeal to a wider audience as many buyers don’t want to take on the task of substantial renovations. Adjustments to value should be made accordingly based on the difference in finishes, upgrades and amenities.
- Listing Price vs Sales Price: The listing price reflects what the seller is asking, but not necessarily what a buyer is willing to pay. Sold inventory is a more reliable data point to determine the price a seller will receive vs comparing a home to other active listings. When interviewing a REALTOR, ask about the typical sale price/listing price ratio for the area AND for homes they have listed and sold.
Article courtesy of California Coastal Real Estate
Condominiums and Houses Currently for Sale
|Active||Ellwood Beach Dr*||$468,000||2||2||1079||55|
* indicates condominium
Closed Sales – Condominiums and Houses
|Address||Sold Price||Beds||Baths||Sq Ft||DOM||Sale Date|
|7606 Hollister Ave 210*||$480,000||2||2||1141||53||04/13/18|
|541 Mills Way*||$539,000||2||2||944||6||02/07/18|
|544 Mills Way*||$585,000||2||2||944||9||04/13/18|
|218 Entrance Rd 5*||$569,000||2||3||1134||33||03/13/18|
|463 Cannon Green Dr A*||$578,000||3||2||1160||103||01/09/18|
|7640 Hollister Ave 272*||$580,000||3||2||1370||44||04/13/18|
|413 Cannon Green Dr H*||$585,000||3||2||1158||13||03/23/18|
|7630 Hollister Ave 239*||$615,000||3||2||1370||123||02/19/18|
|425 Cannon Green Dr B*||$670,000||3||3||1470||22||02/16/18|
|7623 Pismo Beach Cir||$840,000||3||2||1248||6||03/09/18|
|561 Mills Way*||$605,000||2||2||1278||8||04/20/18|
* indicates condominium
- Median condominium sale price in the Ellwood area Jan. – May 2018: $585,000 (11 sales)
- Median home sale price in the Ellwood area Jan. – May 2018: $840,000 (1 sale)