Right now I really wish I had a “do-over!” I just accidentally deleted all my previous posts on this blog — one key stroke, and not even one of those “Are your sure you . . .” questions! So, if this is your first visit, there truly were several year’s prior postings about all sorts of real estate issues. All gone now to cyberspace heaven!
Well, before I forcefully hit that “delete” key, I was about to add a new post; so here is what is on my mind today. Property values.
The value of real estate is basically what sale price a property will bring on the open market. Determining that value is far from an exact science, but is done by comparing a subject property with other “comparable” properties that have sold “recently”, usually within the past six months in the same general area. In suburbia where there are blocks and blocks of almost identical homes that is not too difficult.
Here in Door County Wisconsin it is another story. Homes vary tremendously. So far this year in northern Door County homes have sold for as little as $45,000 and as much as $3,490,000! Homes that vary that much in price can be basically in the same general vicinity too. So how do we do it? Knowledge of the Door County real estate market and extensive experience are critical.
Certainly the size, age, and condition of a home, the amount of land it is on, and whether it is on the shore or has a view of the water are basic elements of value. But there is much more to consider in a home that will primarily be a vacation property because a vacation home is more of a “dream-come-true” place. Not necessarily practical. A place that makes a buyer feel happy, safe, and relaxed. A place to get away to. How do you put a value on those things? Again, the answer is experience and knowledge of the market and the buyers in this market.
When asked to list a property for sale, we begin with comparing the measurable features with other properties that have sold and with those presently on the market as well. Then we factor in all the immeasurable features — the ones we know by experience are going to make the property special in the eyes of buyers. Thus two homes that from a replacement cost approach are identical could vary significantly in actual market value. It is not easy, but it is a challenge that makes my job interesting. When I match up that special property with that special buyer is it a great feeling of satisfaction.
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