If someone told you they would sell you a brand new BMW for $10,000 your first response would naturally be, “What’s wrong with it?” The response stems from the price not aligning within the realm of your expectation.
The same applies to pricing for all industries and the housing industry is no exception.
Which factors influence expectation is a tricky thing to pinpoint. When you are house hunting, you might lean on public estimates such as Zillow or eppraisal as a basis for your pricing expectation. When you are selling your home, you might consider what the home down the street sold for. There is no right or wrong reference point. Each point of information you consider becomes just that – a consideration. Those considerations build up to form a perspective.
The more considerations you have – the more perspective you have.
If you were doing a $100,000 remodel on your kitchen you would naturally entertain multiple bids and consider all perspectives. Transition that logic to home buying – if you were buying a $1 million dollar home, wouldn’t you also consider all viewpoints as well? Public estimates, supply, demand, pricing shifts, pace of sale all become core considerations for what will likely be your single largest life expenditure. With that in mind, when it comes to home buying/selling, it’s always better to have more perspective.