Editorial

Front Page - Friday, December 3, 2010

Real Estate Facts

It all adds up

Elwynn Schwartz

As you search and tour homes that appeal to you, how can you be sure that the asking prices are in line with current values? Begin by asking your real estate agent to collect comparables and prepare a Comparative Market Analysis (CMA). This report indicates market trends by showing whether similar homes in the area are selling for above or below the asking price of the home(s) you’ve selected.
Using the comparables that your agent researched, you’ll be able to figure the average cost per square foot for the area, and determine if the home you want compares favorably with those figures. Total the square footage of several homes and divide by the number of homes to get an average. Total the “sold” prices of each home and divide by the number of homes to get an average selling price.
Now, divide that average selling price by the average square footage to produce the average price per square foot for homes in the area. When you multiply that average price per square foot by the square footage of the home you want, you’ll discover how your choice compares, and then you’ll know if you’re looking at a fair price.
Other factors like the seller’s motivation or urgency may also affect your offer, so talk to your agent about that CMA and take the next step!
Elwynn Schwartz is the owner of Chattanooga Real Estate Consultants and may be reached at 423-894-3050.

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