An experienced developer recognized the potential, but had there been multiple knowledgeable buyers, competition would likely have driven the price much higher - potentially to its development value of approximately $600,000. A savvy agent would have helped price the lot appropriately. The key lesson? The market, not the listing price, ultimately determines what your property is worth. Your strategic objective is to create the market conditions where your property's true value can emerge through buyer competition.
RESPONDING TO MARKE O MARKET SHIFTS
The real estate market is dynamic. While much is said and written about “fed rates,” the economy, and employment, the real estate market is directly tied to “life.” The supply of available properties and the demand for them ultimately drives the market. If there is a closure of a major employer, supply will increase and demand will most likely decline, causing a shift in that market. When Amazon announced that Arlington, Virginia was selected to be an east coast HQ site, the values of real estate in that region increased. While everyone deems themselves a “real estate expert,” realize that watching and tracking every report and activity is not feasible. Just like you cannot track every stock and trade in the stock and bond markets. There are people who do just that. In the real estate market, the best agents, watch analysts’ reports provided through their associations where there are economists and analysts who do nothing but track and interpret data with which to assist their member agents. Unless you have the time and specific skills to perform these detailed studies, rely on your agent’s expertise. They have exceptional resources with which to help you make good decisions.
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