Cleveland OH Real Estate - How Much Can I Get That Home For?

By
Real Estate Agent with Howard Hanna Real Estate Services

Cleveland OH Real Estate - How Much Can I Get That Home For?

how much is that home worth?

When working with buyers, we are often asked this question and the simple answer is this: we don't know!

I realize it may sound shocking that someone who professes to be a real estate professional would openly admit to not having an answer about something related to real estate, but the answer is complicated.

The final purchase price of a home depends on many variables, the most important being the sellers motivation. However, until the negotiating process has been played out, there really is no way to determine what a seller will accept for their home. In many cases, even the seller doesn't know what they will accept until they have received an offer and crunched the numbers.

I realize that buyers want some level of certainty and would feel more comfortable knowing everything up front.  Sure, it would be great if the listing you saw on line read, " great home, priced at $199,999, but the sellers said their bottom line is really $170,000."  Unfortunately, it just doesn't work that way. However, we do have some thoughts on finding a home's value that may be helpful.

To begin, market statistics mean alot as they are based on cold hard facts, not opinions.  Here are statistics from home sales over the last 6 months in some popular Eastern suburbs here in Cleveland. The figures below show the relationship between average final sales price vs. average final list price:

Beachwood -              $278,911 / $299,338 = 93.18%

Moreland Hills -          $316,632 / $334,611 = 94.63% 

Pepper Pike -            $338,072 / $358,562  = 94.29%

Orange -                   $245,242 / $268,198  = 91.44%

Solon -                     $287,006 / $306,145  = 93.75%

Twinsburg -               $211,594 / $221,345  = 95.59%

 

Based on the figures above, a home can expect to sell for about 94% of the final list price. The challenge can be to determine whether or not a home is price competitively, where it will likely receive an offer, or if it is overpriced and due to be reduced at some point in the future.

We recommend that you educate yourself on the market by seeing a lot of homes in your price range and follow the status of these homes. At some point, you will have seen enough homes that you will be able to walk into a home and know if it is a good value. However, other buyers will recognize this too, so if you find a great home at a great price, don't delay for risk of losing it. 

If you are a buyer expecting to get a home for 20% off list price, it probably won't happen on a home that is the nicest in it's price range. However, if a given home appears grossly overpriced based on comparing it to others you have seen, there certainly may be more negotiation room here.

One thing to note is that some sellers know their home is overpriced but just don't want to lower it. They may be open and expecting to negotiate, so don't let a price keep you from trying to buy a home that you really love.

More important than determining "how much can I get that home for", is using statistics and market knowledge to determine "how much a given home is worth to you", because that is really the question that you should be focusing on and can be answered prior to beginning negotiations.

When all is said and done, learning the market is important and having a knowledgeable agent to guide you throught the process is critical to your home buying success.

************************************************************************************* 

About The Authors:

This information is provided compliments of Amy and Dan Schuman, The Schuman Team Keller Williams Realty. The Schumans service both the East and West sides of Cleveland and have worked with numerous professional athletes, business owners, and executives who are relocating to Cleveland. They specialize in the Cleveland Ohio luxury home market and also enjoy working with first-time buyers as well.

If you are looking to buy or sell Cleveland real estate, including the surrounding suburbs, please contact the Schuman Team at 216-346-3235. 

SEE ALL CLEVELAND AREA HOMES FOR SALE BY CLICKING BELOW:

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Cleveland OH real estate - How Much Can I Get That Home For? is the property of The Schuman Team and may not be duplicated or used without their written consent. ©Dec 2009    

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Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. Dawn Maloney 12/15/2009 04:41 PM
  2. Donald Bradbury 12/16/2009 02:42 PM
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Show All Comments
Rainmaker
563,333
Corinne Guest
Barrington Realty Company - Barrington, IL
Barrington's Country Suburban Home Matchmaker

What don't you have a crystal ball? I though every agent got one with their license - LOL

December 15, 2009 06:29 PM #10
Rainmaker
351,538
Damon Gettier
Damon Gettier & Associates, REALTORS- Roanoke Va Short Sale Expert - Roanoke, VA
Broker/Owner ABRM, GRI, CDPE

If we had that crystal ball we would be great wouldn't we?

December 15, 2009 08:36 PM #11
Rainmaker
194,785
Emily Lowe
The Lipman Group Sotheby's International Realty - Nashville, TN
Nashville TN Realtor

The funny thing to me is that there are often buyers who are not represented by me who want me to answer that question.  I NEVER venture a guess then. 

I love your post - it's very thorough and I like the way you average out the different areas...

December 15, 2009 09:54 PM #12
Rainmaker
210,497
Nathan Tutas
Tutas Towne Realty, Inc. - Davenport, FL
Your Central Florida Real Estate Expert

Good post and good points. I have found that the key for me is to be able to effectively communicate the complex answer in a concise way. Oxymoron I know, but that's what's working for me. The consumer isn't privy to all of the complexities that go into the answer so it's our job to educate them. It's frustrating at times but it's also rewarding.

December 15, 2009 11:03 PM #13
Rainmaker
996,038
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Dan and Amy:  Whenever I am asked... "How much will they take ?"... my favorite answer is... "I don't know, but I know a great way to find out... ."  They then look at me kinda funny-like.  It's so fun.  Then... sooner or later... we end up making an offer.  Yes... much fun !  

By the way... Super Job !  Congratulations on your Featured Post and your Gold Star !  Hooray for You !

December 16, 2009 12:33 AM #14
Rainmaker
996,038
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

By the way... after reading all the comments... I will say... that I rarely get into percentages, or statistics, or any of that stuff.  Usually when my buyers ask me that question... it simply means they want the house... and don't want to horse around taking a chance that they will loose it.  So... we end up making a pretty decent offer.

December 16, 2009 12:35 AM #15
Rainmaker
744,768
Gabrielle Kamahele Rhind
KGC Properties LLC, Tucson Property Management & Real Estate - Tucson, AZ
Broker/Owner

GOOD MORNING DAN!  I had to stop and say - CONGRATULATIONS!  You've written so many wonderful posts and I'm happy to see this featured!  --Gabrielle

December 16, 2009 04:55 AM #16
Rainmaker
1,818,941
Gabe Sanders
the BlueWater Realty team specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Hi Dan and Amy, so true.  Some folks have some very unrealistic expectations in todays market. 

December 16, 2009 07:14 AM #17
Rainmaker
296,982
Dan and Amy Schuman
Howard Hanna Real Estate Services - Solon, OH
Luxury Home Specialists

Ken - It's nice to see you have some areas that are close to 100% SP/LP, a sign of a good market.

Corinne and Damon - Unfortunately, no crystal ball, but it is funny that buyers think we have the magic answers to questions that cannot be answered easily.

Emily - Thank you for your comments. I agree, nothing is worse than someone not represented by us asking for our opinion. I had this happen recently as the buyer chose to work directly with the listing agent as he thought he would get a better price, but kept calling me to get a pricing opinion. Needless to say, I didn't give him my expertise and he ended up, in my opinion, overpaying for the home.

Nathan- You hit the nail on the head, communication is the key, especially with complicated subjects.

Karen Anne - Thank you for commenting and nice to hear from you. I'm sure you aren't missing the cold and wind here in Cleveland. We like to have fun with these types of questions as well, and I realize buyers sometimes ask things because they don't know what else to ask or just don't know how to get to the next step, so I suppose we all have a special way of guiding our clients through the process.

Gabrielle - Always nice to hear from you and thank you so much for your kind words. I'm still amazed at how early you start your day.

Gabe - Thank you for commenting as well. I agree, buyers and sellers both often have unrealistic expectations but a little education often goes a long way.

December 16, 2009 08:05 AM #18
Rainer
50,670
Erin Golding
Hallmark Sotheby's International Realty Hopkinton, MA - Bellingham, MA

This is excellent!  I'm bookmarking this to use as an example in conversations with my buyers.  I have one who'll love the statistics in our area!

December 16, 2009 08:25 AM #19
Rainmaker
285,954
Marilyn Harrell
ReMax Riverhaven - Beaverton, MI
Wixom Lake - Beaverton MI

Great post topic and your comments are educational as well! Have a great day!

December 16, 2009 01:34 PM #20
Rainmaker
296,982
Dan and Amy Schuman
Howard Hanna Real Estate Services - Solon, OH
Luxury Home Specialists

Erin - The real analytical clients love to see numbers, thanks for commenting.

Marilyn - Thanks for stopping by and you have a great day as well.

December 16, 2009 04:06 PM #21
Rainmaker
558,659
Chris Olsen
Olsen Ziegler Realty - Cleveland, OH
Broker Owner Cleveland Ohio Real Estate

Hi Dan and Amy -- Well said and I totally agree.  Sometimes, there may be an artifical constraint on a property in that the seller bought a few years ago, is hoping to break even, but the market has plunged 20% over the past few years and their home is no longer worth what the market is currently willing to bear.  Sometimes these sellers need a certain amount to keep it from being a distress sale, or simply don't want to lose money.  It takes a savvy agent who knows and can research the local submarket for relevant comparables to properly advise a buyer so they can make a well informed decision.  You write so well and this post is very, very informative and I hope buyers out there read it.

December 16, 2009 04:35 PM #22
Rainmaker
409,845
Michelle Francis
Tim Francis Realty LLC - Atlanta, GA
Realtor, Buckhead Atlanta Homes for Sale & Lease

Dan & Amy,  The real number of what they will take varies tremendously.  Typically, we can gather a lot of data, but determining their MOTIVATION is critical.  One property I helped buyers get this year, went much lower than I expected (and felt it was worth), but they were highly motivated and able to bring money to closing to get it off their backs.  Great deal for my client, but I was preparing them for a higher number, as that is what the stats were telling me.  So, you never know until you try.  All the best, Michelle

December 16, 2009 04:38 PM #23
Rainmaker
296,982
Dan and Amy Schuman
Howard Hanna Real Estate Services - Solon, OH
Luxury Home Specialists

Chris and Michelle - Thank you so much for your comments. Hopefully buyers will realize that a lot goes into determining an answer to this often asked question.

December 17, 2009 11:23 AM #24
Ambassador
1,554,208
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 800-610-7253 DRE01267479 - Costa M

We don't know how much the buyer can get the home for, but we can take a fairly educated guess based on comparables and actives still on the market.

What they offer will depend upon their own motivations.

Of course when you throw in short sales and the banks, that's a whole new story.

December 17, 2009 11:18 PM #25
Rainer
27,283
Danielle Pierce
Platinum Realty and Preservation - Chicago, IL
ADPR

I definitely see a RE-BLOG in our future. LOL! I get asked that question all the time. My other favorite is: how much did the seller accept (when the property is still showing as under contract)! Great post!

December 18, 2009 09:35 AM #26
Rainmaker
296,982
Dan and Amy Schuman
Howard Hanna Real Estate Services - Solon, OH
Luxury Home Specialists

Christine - Thank you for comments and yes, motivation is always key.

Danielle - Feel free to re-blog. It is a question that comes up quite a bit so it is good to be prepared for an answer.

December 18, 2009 04:25 PM #27
Ambassador
2,387,345
Patricia Kennedy
Evers & Company Real Estate, Inc. - Washington, DC
For Your Home in the Capital

Dan and Amy, I always tell my buyers that there is only one way to get an answer to that one - write an offer.  And the important number is the price, in relation to area market values, not how much off the list price you are paying.  Getting a hugely overpriced place for 60% of the list price might cost you more than one at over a reasonable asking price that got bid up a wee bit. 

December 19, 2009 03:36 PM #28
Rainmaker
296,982
Dan and Amy Schuman
Howard Hanna Real Estate Services - Solon, OH
Luxury Home Specialists

Pat - We agree wholeheartedly with you. Some buyers are just so afraid to take that step to write, especially the first timers. Thanks for stopping by.

December 19, 2009 05:24 PM #29
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Rainmaker
296,982

Dan and Amy Schuman

Luxury Home Specialists
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