Real Estate Agents don’t determine price of a property, the market does. Property values at any given time are determined by the demand and supply. External factors like low interest rates increase the demand and things like a recession decreases the demand.
Remember how you determined the price when you bought your home?
All the buyers look at the existing similar homes and also compare home prices. To get the maximum sales price for your luxury home, you should price your home at the low end of comparable listings (active homes for sale), or the high end of comparable solds, whichever is lower.
Location is the most important factor for the buyers, followed by the size of the home and the amenities come last in the priority list. Things like infinity swimming pool and a basketball court add value to the home but location and size are ranked higher by buyers as location impacts things like school district and access to shopping, parks, sports facilities etc.
Amenities only come into picture if the home is priced fairly compared to other homes (comparables) of similar size in same location.
Here is a simple way to look at various numbers:
Cost = what you paid, does not affect value (if you paid zero would it be worth zero?)
Price = what you ask when you list the home
Value = worth to a particular buyer
Market Value = sold price in reasonable time
Buyer’s use the principal of substitution and they will consider their other options available in the market. For amenities, they will look at replacement cost. E.g. cost to build a new swimming pool compared to paying for a home with a pool especially when a buyer can get a brand new pool!
Home improvements are for enjoyment and they do not increase value. Appraisers routinely discount amenities like swimming pools by a factor of 50% when appraising the home. The Seller’s that are pricing their luxury homes realistically with these facts in mind are still selling.
About us: Dallas Luxury Real Estate Agents
As top Dallas luxury real estate agents and Dallas relocation specialists, we take great pride in using our expertise, resources, and global connections to perfectly unite extraordinary places in a variety of lifestyle categories and price points. Discover why we are one of the most respected teams for buying and selling in the Dallas area. It is also important to highlight that luxury is an experience, not a set number. Price point does not define luxury. We provide the same elevated experience to every client. From sky residences in Downtown Dallas’ premier high rise buildings to distinguished properties throughout cities like Southlake, Highland Park, Westlake, Lakewood, Preston Hollow and University Park, we offer real estate buyer and seller representation services that give our clients the edge when buying or selling luxury real estate in Dallas metro area. Our commitment and daily dedication is to delivering a high level of expertise with extensive hyper local market knowledge, savvy negotiations and innovative technology.