I must say I appreciate you getting right down to the information and not killing me with a bunch of advertisements or sponsors I click your video and you start talking.THE BEST💥
I'm a professional RE appraiser, this is very good advice. Just one caveat: You must be brutally honest with yourself about the realistic value of a property that you have a vested interest in. Don't cherry pick the comps to confirm your bias. If you cannot do this, or lack experience in a particular market, it may be wise to seek the council of a knowledgeable 3rd party.
There is one other thing I like to consider: the cost of land + construction. Doing this should give you a ball park of the cost of the house, if the house is much more expensive than the land + construction then you should not buy that house and be better off with building your own house. Another way to determine the value is by the average rent per room in that area considering the bathrooms. If the mortgage is above the average rent at 3.5% down, that house is too expensive. Your mortgage should always be less than rent because you’ll be paying repair costs and have higher risk. The next is to find houses that are exactly the same quality, size, number of rooms and bathrooms, and year built of the house want to value and take an average of that. It can give you a reasonable estimate but not always, because a lot of people buy overpriced or sometimes underpriced houses which will skew your numbers. If you find a high quality remodeled house but the house you are looking at is outdated or broken, you should get a contractor to give you some repair estimates and inconvenience costs then you’ll know the value. I generally do not like appraisals that only look at what others have bought/sold in the area because it doesn’t take into account that favorable economic terms or good mortgage rates that cause people to overpay for properties.
Research price of surrounding properties. Check neighbor hood building restrictions. Sometimes people come into a great neighborhood and set up a hudge bus repair service. / or etc. Massage / etc.
In Tennessee , Public libraries have a monthly free magazine relating to all court house/ activities. HOUSES LAND ,bought/ sold/ prices, former owner/ etc, in each zip code. BUILDING PERMITS OBTAINED/ Marriages/ divorces/.. court activities...
@Sara-wv3ms Yeah, my thoughts exactly to what was said in this video about solely relying on sales comps. How do you know if the market is overpriced? This where market value versus fair market value come into play.
You are a champion, no B.S straight to the point speaking from experience. I have been trying to read textbooks etc on appraisal techniques, all it did was leave me feeling angry.
Phil, THANK YOU!!!! I am a newer agent and all the people in my office say to do a radius of 3 miles that may or may not be in the same neighborhood. Not the same product if you ask me. How many comparable properties should I use? The people I have asked how to do this do over 50 and in the last year, because the tax assessor says to. So so many people do this wrong. My thoughts on why someone does this is to get the listing, raise the market value so the owner of the home feels like the realtor is on their side. FALSE! It will cost money and you will lose money by staying on the market longer. I am following you now! Thank you for your videos!! You rock!
You nailed it. When someone sells their own properties to earn their living, they no longer pull comps with the agenda of getting the listing; instead, they pull comps to accurately reflect what the house will truly sell for. The difference can be enormous. I pull every comparable closed and active comp; sometimes there are only a few, other times there are 6-10. It's not how many you pull, it's that you pull ALL the most comparable listings.
Lindsay Berry yea I just bought a home it was on the market for 6 months They went from 385 to 370 365 then I bought it for 354 I'm sure they were paying $2000+ payments Also buyers see 6 months on the market and offer very low bids (like I did) because time was on my side. And seller may get desperate or just want the peace of mind.
Good video on determining property values. We use the county tax roll only for information. Zillow prices are known to be off in our state by up to 10% or higher. The old saying that I was taught is, You can price something at any price but you have to have a buyer that wants it at that price.
I think everyone here online loves MR. Phil Pusterjovsky. So many people have dreams, and Mr. Phil helps us to fulfill them faster. Mr. Phil i sent you via post a cake...did you get it? Was specially baked by my gran mom. Just joking...but one thing is clear. Well educated person and shares knowledge with others. Thank you
That's usually how the sales price appears on public records, it is based on the conveyance tax. However, as stated in the video, buyers of real estate can pay more in conveyance tax to make it appear as if you paid more for the property than you really did. The only resource that tells the correct information is the MLS
Thank you for your videos. First time home buyers here. You answered more questions in 5 video's than other video's I have watched. Thank you for your time.
AGAIN! Phil, you have hit the nail on the head that much of the propaganda of real estate boils down to understanding the human psychology behind it. Computers do not have human understanding OR intuition! Thanks for another clear, transparent, communication. -Future Seller 🙂
I agree on many of Phil's views in the videos I've seen so far. A few more comments: as he said the property appraisers (PA) don't have access to the property, and in part of the process in calculating value will measure the outside of the property. In the case of a 2-story structure, the PA doubles the SF to play a role in the assessed value. TRUE STORY: What happens when the home has a balcony overlooking the living area on the main floor? Looking outside at the roof line, the front part of the roof is much longer than the back? More than half of the upstairs bedroom area is not livable - but the PA office doesn't (will not in Lee County Florida) adjust the assessed value. The mis-assessment may become apparent when an appraiser goes inside the home and measurements are made. The result may be that the appraisal comes in lower than the assessed value.
Phil, I didn't read all the responses to see if any of the following comments were made......motivation of the seller and buyer regarding the comparables is key. This would entail reaching out to the agents or buyers & sellers involved in the sale. If a sale is distressed in any way, it's not likely a good comparable. Driving by the comparables is also important to see if there are any external factors that may have influenced the final sale price (high tension wires, proximity to commercial uses, etc.). I could name a few more instances where the choice of comparables is complicated. Proper research takes time and a certain amount of experience. This explains why the entry level into real estate appraising is so high. (Minimum of 2 years and 2,000 hours of supervised training, plus a college degree AND 120 hours of class time! Oh, and a 6 hour state test.)
I have noticed, that within an hour of putting a house on the market, Zillows Estimate magically turns into the exact same number as what I listed it as.
The only thing wrong with sales price is that the sales price can be grossly overstated, especially in real estate (remember the real estate crash, and ensuing economic crash?). At one point, sellers were getting into bidding wars over properties and the final sales may have been way over the top compared to what it should have been, if the price had been grounded in something more repeatable, like construction cost for example, which wasn't even mentioned in this presentation. At one point, banks and realtors were very motivated to originate loans or sales at the highest price possible, again with no grounding in objective fact. In terms of assessing, "chasing the sale" is sometimes a quick way (read: less work) around actually determining the value. However, since this is about making money more than anything else, realistic values are not as important as high values, regardless what the long term economic pitfalls might be.
So use MLS in conjunction with the records, find the owner and liens, then compare similar homes in the area (pros, cons of both) and work out a figure. Then you can double check vs redfin, zillow, trulia, etc, to see how accurate.
In person, the county records are free to search. But if you want to search county records online, some counties charge a monthly fee. Other counties provide all of their records online free of charge.
You also need to consider the extra amenities that comes with the home, such as in ground pools, decks, attached garage etc And the types of building material used in construction such as brick facade vs vinyl siding, counter tops, walkways, tool sheds, bathroom materials, flooring materials etc. In the end the homeowner should set the price, not the agent. The agent should only find and do the comparisons and make the recommendation.
Good point Mr Hensley, but I had presumed that Phil was referencing primarily non-investment properties in this talk. And I agree with his reply that cap rates are a component of the final value. Market, location, age (economic life) - and other components - play their part as well. Good video.
Depends on how your Lease Option contract was written. Also, you can't do it if you are in Texas unless you follow certain strict guidelines. Texas doesn't like sandwich lease options.
Love your comment, "don't rely on computers". We need more people like you to tell that to the "powers at hand" trying to push the appraisal industry in that direction and force appraisers to be data entry clerks with fees to match.
Bingo on county records. As an appraiser of 19 years in Denver I have told agents time and again. DO NOT get property characteristics from county! But they don't listen. Appraised a home in an upscale Denver hood recently. Agent uses county for square footage, well after measuring the subject it was over 800 sf bigger above grade than what was listed. And by using the county numbers the property was under contract well below market value. Ya think the sellers were pissed off? People, consult with an appraiser, you're dealing with a large asset, it's a small amount to pay in the big picture. I don't need to provide a full blown Fannie Mae appraisal to help an investor or agent determine a list price.
First position gets paid first, second position gets paid second, and so on. Some people have a first and second mortgage on their home. The first mortgage is the lien in the first position. The second mortgage is the lien in the second position. If there is another lien, it could be in the third position behind the first and second mortgage.
Banks are supposed to compare...unless they are hooked up to city mob and are dealing with a sheriff/mob resell trying to keep the tax value up but ruining credits when hit hits the fan. Rinse repeat, they even get kids dads to come over and work months and pay contractors helping kids trying to hold on so it works great for them sometimes. That is why insurance checks get written to owner and lender maybe(a little).
I'm wondering if you can help me out?? We've looked at a house- it was built originally in 1902. That part is the kitchen, dining room/living room and 2 bedrooms and bath upstairs. Then they added on in the 90's to include a living room, master BR, master BA, 2 sided fireplace and basement. THEN, in the late 90's they added an INDOOR pool to the end of the house along with a bathroom, shower and sauna and an atrium area. It's beautiful and big but it HAS to cost a fortune to heat that pool!!! We've taken recently sold properties and broken this one down to try and get a price but... a house that was built that early and then had wings added on later... how do you compare apples to apples even? lol well, we did our best. It's also 150 acres so... we took the 50 acres and the house with outbuildings and pretended the pool was out of the picture. Then, figured for the other 100 acres of land. (the more you buy the cheaper per acre it is) and we figured those up then added another... $30,000 for the pool. I have NO CLUE what the cost of a pool is but I can imagine most people think it's cool but a definite money and time drainer. My question is this.... They want WAYYYY too much for it. Just under $1,000,000 but we're figuring $600,000. We've got our figures all down, what properties we looked at and came up with the numbers, etc. When we get to the point of making our offer, being it's SOOOO much lower, WHO do we discuss this with, of where we came up with this? Or does that matter? The owner is 81 and he was a lawyer. They're moving to assisted living so... IDK how long they want to wait for a buyer but... that price is WAAAAYYYY over anything else in the area. Should we sit down with our realtor who showed us the house and show her what we came up with? Have the seller's realtor find comparables and see what the realtor thinks would be best? how do you go about it when it's THAT big of a price difference? If he were to sell the house separately and each parcel of land separately, then he might get something close to the at price but... IDK. I'm just wondering what the best way to go about making an offer that different in price, would be. And it's been on the market for almost a year and 1/2 now for different prices with different amounts of land- there's 300 acres total but now they have it with 150 acres. Sorry for rambling. lol Can you help at all?? Anyone?? Thanks for the great videos!!!
Tara Owen I would suggest writing a personalized letter to the owner explaining the situation in the kindest way possible and including all the research and comps in the area you have found trying to in essence explain to the seller why your offer is so much lower than the asking price. Everything is negotiable. Good luck
Informative video but a big factor in valuing a property of course is its condition and cost of renovation. This is where the average owner or potential buyer is usually at a disadvantage. Property's true value = comparables minus the renovation cost if the property condition is a negative.
Hi Phil. Best ever explanation on where and how to determine the value of a property!!!!! I have been comparing websites like Zillow and Trulia for my properties and have found the sqft of properties listed by them, most of the time differ from what it is on the county records. Whose sqft is the best one to use, then as you did mention these sites are not the best ones to use for comps. You also say we, investors, can access the MLS for free. If so, then I don't need a REA to sent me the CMA of a property? Or even if I can't access the MLS, my best source of getting the best comps for my property is via the REA? Thanks again for a great tutorial!!!
Excellent!! Quick question when u r selling a house n say it’s a one story and the only 2 to compare in the same subdivision n both are two stories w/ all the same features such as bedroom and bathrooms granite backsplash etc how will that compare to my one story house during appraisal? Thanks
Phil Pustejovsky thanks for the reply, true. But when the appraisal comes to property site what will they compare to? Will they compare to those 2 stories that were sold 6 months ago or will they go out from my subdivision n try to find another 1 story with same features n compare it to that ? Will they even consider the price sold on the 2 stories as comparable? Thank again!
Thank You Sir for taking the time to coach others. 1 question: would it be better if i use my own cash to purchase an investment home for flipping purposes than getting a loan ( given I have the cash available) thank you Sir.
I just started in Real Estate and I partnered up with a friend who has experience and has flipped 4 rehabbed houses. My father who is a PM at the port authority, said he would help me buy lots and build a house from scratch. In your opinion what would you say the best option for me. Rehabbing houses or build from scratch?? I understand both have their own problems and have their own risk reward
I have used MLS and it didnt come in true, as you said the area I was looking at was much different from one or two blocks away, true info, James Bischoff
The one thing I never understood about valuing a property is why don't people compare neighborhoods from all over the city or say neighborhoods that are 5-10 minute drives apart. Appraisers only seem to stick to nearby neighborhoods that are similar for valuing property and homebuyer's seem to trust them. If I'm a homebuyer looking for a house, I will look in multiple places in a city at similar homes to come to a value. Shopping for homes around a certain neighborhood is like shopping for cars at dealers within a 3-mile radius.. If you go to the other end of a city you might find a dealer selling the car a little cheaper. It's not always easy to find comparables in a small radius especially if no homes sold recently. But if you go across the city to a similar neighborhood, then voila! You can get good comps!
The problem with your analogy is that location plays a huge role in price. Even "comparable neighborhoods" if they are in opposite sides of town can command vastly different values, due to different factors (nearby amenities, highways, shopping centers, schools, etc). That's why it is important to stick to nearby (and truly comparable) areas to get the most accurate estimation.
robertoospina10 No. u WANT to remain within one mile of your subject property, at most. If u go too far away from tha property that youre looking for comps for, that neighborhood could very well be valued either much lower or much higher, which will certainly screw your comps...Good comps are: 1. Similar in sq footage within + or - 10% of subject property. 2. Similar in condition regarding amenities/upgrades. 3. Within same area. This can get veeeery tricky. A property within tha SAME zip code/area, even within one mile of subject property, can be valued veeeeery differently if perhaps it is across a freeway, across railroad tracks, is part of a new subdivision, ect. This is where knowledge of your market is crucial.... 4. Ideally sold within last 6 months. This will be different for luxury properties. Very different....all of tha aforementioned.
I just saw your question. In 2007 I was a realtor, for a brief period of time. One of the things newbie realtors do is to "sit" at open houses for the more experienced realtors. It gives the newbs experience and the veterans can goof off on the weekends. OK, fine. I happen to live in a particular area where the schools are rated 2nd in the state (CA) One time I sat for an open house for another realtor, at a house that was pretty much identical to the one I lived in at the time. But it was in a different school district, and the other school district was......uhhh, sketchy. Not that well rated. The houses had had about the same number of sq ft, lot size beds/baths, size, style, condition, without question within $20K or each other. The house I lived in was valued about $125K-$150K more than the one I sat at. Due to school district. (As it happens, as a selling realtor in CA you CAN NOT say that one house is in one school district over another but that does not mean that buyers cannot research that and come up with their own conclusions. And they do, and will) The lower valued house was actually in a tiny bit better neighborhood. The houses were within about 4 miles of each other. Just sayin' the difference in values was pretty striking.
I would like to know which method of property valuation between the investment method and the direct comparison method is the best to use to value landed property in a depressed market?
Sometimes I see houses listed on sites like Zillow listing 0.75 bathrooms, and on this one property the county (also Volusia) has it listed as 1 bathroom. I've seen the house and it is a full bath. What is 0.75 bathroom anyway, a bathroom with a toilet, sink, shower but no tub?
We have made a ton of money in Texas. If you are accepted into our program, we would have you do deal right there in your own hometown. Everything is bigger in Texas, as they say, and oftentimes that includes the profits as well!
Good central point of not relying on computers and algorithms to do your analysis. But the income and cost approaches to valuation are very important and shouldn't be overlooked, especially for investors who are presumably using buy-and-hold and/or fix-and-flip strategies.
True, from an appraiser's perspective the comparable sales approach is usually weighted more, even on a 4 unit investment property. But there's a section on Fannie's small income property appraisal forms to analyse the income approach, and some appraisers place at least some weight on that approach when rental data is available. But what I'm saying is, investors considering a buy-and-hold strategy should place some weight on the income approach and more emphasis on a property's net operating income, regardless of what an appraiser considers. Of course, I'm biased, being from the SF Bay Area, where buying with severely negative cash flow (and often with protected, rent controlled tenants) is commonplace, because people are content to go off comparables and bank on appreciation. Scary Stuff.
Phil you may not get this but really thinking about trying to become a mentee. Do you already have too many people in the Pittsburgh Pa area? You are so knowledgeable and i feel that you are actually someone in the real estate teaching field that is trustworthy If it wouldn't work out i have learned precious information already. I found you about 2 weeks ago and have already watched 70% of your videos in my spare time. Thank you thank you thank you.
Great info. By me being very new to real estate wholesaling this is were I am more confused on. How to value a property the right way. It makes a little more sense but I still need to gain more knowledge before getting my first deal.
Comps are excellent for single family, but when comparing multi-family sales in my city, the few properties I can find are all over the chart. Plus those aren't usually direct comparisons.
+Phil Pustejovsky So how to do you base your numbers if the multi-family is not currently preforming? i.e. needs rehab to get up to 'market rent', plus only 1 of 3 units is even currently rented. Would you use the current rental rate, figure percent that cash flows and your own ROI? Something like 12 * (current rent * percent rent that cash flows including vacancy ) / ROI
Great video, Phil! Thanks so much for sharing your insights. One question: in your opinion, what criteria should investors use to determine reasonable comps on the MLS?
Buyers determine the property values in that property is only worth what someone is willing to buy at and the vendor is happy to accept...previous sales of similar property in the same area only reflect what other buyers(who are now out of the market) have paid to live or own in the area. It does not reflect on how well the property was negotiated, the condition of the property and the vendors need to sell. Actual prices received vary at least 5% to 7% + or - at the very least...just sayi...
Although you are right, try using that argument to any bank in the United States. They aren't buying that logic. Instead, they will only loan based on purchase price or appraisal, whichever is lower. And appraisals are based on previous sales. And most real estate sales involve a loan. So if you want to determine your property's market value, it is unfortunately tied to previous sales, not necessarily what someone else will pay for it. Right now, across the country, sales prices are exceeding appraisals (I'm watching it happen almost every day) and sellers are being forced to reduce their prices in order to sell even though the Buyers were willing to pay more.
Hello, I have run across a house built in 1981 burned down and rebuilt in 1997. How do I comp or what do I comp it against when everything around it was built in the 80s. Just heard you mention the same scenario as I was writing this. " Take to the mls not the computer" is what I heard. Does that mean to go through mls finding homes with the same criteria no matter where they are. Location is a factor in pricing, what about that. Do I have to find out what the market was like back in 1997. Please help straighten me out. Am I too far out on a limb. Whatever you have to say would be helpful. Thank you. Denise
Great analogy using cell phones. If people actually took your advice in shopping for cell phones and comparing them they would not pay $1,000 for an iPhone or a Samsung Galaxy when they could get the same phone from Motorola for $200. That's like paying a million dollars for a house that's worth $200,000 because they didn't bother shopping around for houses. People do this all the time when they buy a house in a gentrified area when they should instead be buying a house in an area that might be the next gentrified area.
Take away - Look into MLS MLS - Multiple Listings Service More specifically: Each MLS is independently owned. You'll see the checks/balances that keep the tax assessments from being 100% False. Also, updated Sq/ft, bedrooms, etc. MLS is a good place to start for "real" home values. P.S. County records helps shows leins and negative debts on the property. (combo of both is best)
For the areas where the local MLS has allowed that system to suck the data out of the true local MLS and into RPR, it can be helpful, but still not as good as the actual MLS. I use RPR in a pinch where I don't have MLS access. The issue is that not all local MLS systems link up with RPR even though it is part of the NAR.
You give a great video, awesome energy. I found you while trying to come up with a list price for a home built in 1926 with no comps! I'm over here in Sarasota :-)
When finding out the ARV of a property, you look at surrounding similar sold comps. But some comps are of properties that have been bought by other wholesalers or that are still in need of repair while others are after repair. So how do you know which ones to use in your calculation. In other words, say I have a couple of properties that are 42-55 a sq ft and the pictures of those properties look like they are older properties (of around the same age as the subject property) , and then there are other properties that are 100-112 a sq ft and are newer (more recent builds), then do I use the comps of the older properties just because they are closer in age to the subject property?
Phil, When you make comparisons on other homes, does land play a factor also? In other words if I have a house on an acre of land but it's an older home and I don't have a garage or walk in closets, but have upgrades in kitchen and bathrooms and finished upgraded attic,.does that play a factor in the value? How can I determine what the difference between a new house for 300,000 that has all the bells and whistles but no land or a house that is 30 years old, has the same square footage, upgraded kitchen, bathrooms and new roof with a lot of land. Can you help me determine that?
Lenore Manns All of those factors play a role. A local appraiser could educate you on how those different facets adjust the comparable sales up or down.
Phil Pustejovsky Thanks Phil. I was hoping that this was something I could figure out myself. I thought that was the purpose of this video, which I find very informativie. A realtor can also appraise my home, but I wanted to avoid having to pay the 6%. I'm getting educated by your website.
Do you know how to get Zillow to correct the market value of a home listed for sale? A home I have listed is well below market value. Please advise. thanks.
Hi Phil As a newbie please excuse an obvious question--would a buyer's agent give you this valuation without the leg work, or would you, as an investor, forego a buyer's agent? I had an interest in a property I thought might sell for 45K ARV-an agent I spoke with seemed very knowledgeable of the zip and said more like 37K. Your advice?
A buyer's agent can certainly provide an opinion. But ask yourself this question...how does a Buyer's Agent get paid? When you buy. So they have an inherent conflict of interest. The best and most successful real estate investors do their own evaluations. Sure, you can take input from buyers agents, appraisers, etc, but ultimately, this "leg work" is the most important leg work you do on a deal. I spend more time doing this than any other part of my real estate investing business. And every minute I spend doing it is time well spent.
Thank you Phil for that incredible content. I just stumbled across your channel today and I am amazed of that quality you putting out here. This is highly appreciated!
@PhilPustejovsky I was just wondering, after watching some successful individuals, who have been wholesaling properties for quite a while. And they use an established ARV system, should a real estate wholesaler utilize the same ARV system in Canada? Or should there be some sort of adjustment made, because Canada's real estate market is over inflated by %65?
Hi Phil, I have a question. I have a house in Idaho, which I urgently need to sale. You say that the information on which the value of the house needs to be based is obtained from the county office (tax assessor and register of deeds), right? now, is this some information that my potential agents are suppose to collect from the county office? or am I supposed to provide them with that information while they extract the other half of the info from the MSL? Also, if I am the one supposed to request the information from the tax assessor and the register of deeds, am I supposed to also request the information about the comparable houses in the area? meaning, the part you were explaining about whether a house has liens on it, who owns it, etc. Will the county office provide me with that information without any issues? or will they only give this info to the real estate agent working on the selling of my house?
+Amy Gavin This video tries to explain the weaknesses in public records data such as the County Register of Deeds and the Property Tax Assessor. The MLS is the only source for truly accurate data and only real estate agents have complete access to the MLS. If you are selling your house, your MUST watch this video. Watch it twice: ruclips.net/video/c5Lk0FNKRg8/видео.html
Thank you so much for your clarification Phill, I appreciate you taking the time to answer my question. Now, if you don't mind, would it be ok for me to ask you another question regarding the selling of my house? This house I'm wanting to sell was $132,000 when I bought it 9 years ago. Even though I have spent roughly $90K on it so far, 66% of those $90K have gone to pay interest and other additional fees, which is the reason why I have only paid in reality $31K towards the principal. Now, my question is, once I sell that house, what quantity will I actually get back? will I get back only the $31K I have paid towards the principal? or will I also receive the $60K I have paid towards interests and additional fees? Thank you again for your time and patience. V/r Amy.
+Amy Gavin you will get back the difference of market price (what your home sells for) and settlement expenses (escrow, fees, recording, commission if broker transacts, any concession you may offer) plus your mortgage payoff.
Phil, I'm trying to do a title search in Madison County Alabama, and the system is an arcane nightmare. First, the county departments list did NOT include either a recorder or register of deeds. After looking around awhile, I finally found the office that allegedly has deeds, etc. But when I tried to do a search, there was NO WAY to do a search for a specific address. The site had all kinds of search categories, but none that seemed promising to find the deed for a specific property. Help! Is there something that I need to know that I'm missing here? Thanks.
They may have an accurate report based on the closed comps they used to create the report, but the number they determine may not precisely measure what the house will sell for in the real world. Appraisal and actual market sales price can be two very different things.
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I must say I appreciate you getting right down to the information and not killing me with a bunch of advertisements or sponsors I click your video and you start talking.THE BEST💥
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I'm a professional RE appraiser, this is very good advice. Just one caveat: You must be brutally honest with yourself about the realistic value of a property that you have a vested interest in. Don't cherry pick the comps to confirm your bias. If you cannot do this, or lack experience in a particular market, it may be wise to seek the council of a knowledgeable 3rd party.
Beta Eta confirmation bias is a hell of a drug. You're 100% right. People with a vested interest often pick out comps that support their bias.
Comparisons. Houses that have sold in the same area that can validate the price
Where is the best place for me to start getting some experience with real estate investing?
If you are counting on RUclips comment replies to direct you, you should probably pass on this one
where you live, do you own or rent, if you rent, buy something and build equity while you live in it.
There is one other thing I like to consider: the cost of land + construction. Doing this should give you a ball park of the cost of the house, if the house is much more expensive than the land + construction then you should not buy that house and be better off with building your own house. Another way to determine the value is by the average rent per room in that area considering the bathrooms. If the mortgage is above the average rent at 3.5% down, that house is too expensive. Your mortgage should always be less than rent because you’ll be paying repair costs and have higher risk. The next is to find houses that are exactly the same quality, size, number of rooms and bathrooms, and year built of the house want to value and take an average of that. It can give you a reasonable estimate but not always, because a lot of people buy overpriced or sometimes underpriced houses which will skew your numbers. If you find a high quality remodeled house but the house you are looking at is outdated or broken, you should get a contractor to give you some repair estimates and inconvenience costs then you’ll know the value. I generally do not like appraisals that only look at what others have bought/sold in the area because it doesn’t take into account that favorable economic terms or good mortgage rates that cause people to overpay for properties.
Research price of surrounding properties. Check neighbor hood building restrictions. Sometimes people come into a great neighborhood and set up a hudge bus repair service. / or etc. Massage / etc.
In Tennessee , Public libraries have a monthly free magazine relating to all court house/ activities. HOUSES LAND ,bought/ sold/ prices, former owner/ etc, in each zip code. BUILDING PERMITS OBTAINED/ Marriages/ divorces/.. court activities...
@Sara-wv3ms Yeah, my thoughts exactly to what was said in this video about solely relying on sales comps. How do you know if the market is overpriced? This where market value versus fair market value come into play.
Thank you for your willingness to share your experience. I appreciated your thorough and enthusiastic approach. Thanks
Years later and you video still helping people out. Thank you 💯💯💯
This is a very introductory lesson but it IS ACURATE! I own a Title Search company and I deal with a lot of this on the daily basis.
You are a champion, no B.S straight to the point speaking from experience. I have been trying to read textbooks etc on appraisal techniques, all it did was leave me feeling angry.
Phil, THANK YOU!!!! I am a newer agent and all the people in my office say to do a radius of 3 miles that may or may not be in the same neighborhood. Not the same product if you ask me. How many comparable properties should I use? The people I have asked how to do this do over 50 and in the last year, because the tax assessor says to.
So so many people do this wrong. My thoughts on why someone does this is to get the listing, raise the market value so the owner of the home feels like the realtor is on their side. FALSE! It will cost money and you will lose money by staying on the market longer. I am following you now! Thank you for your videos!! You rock!
You nailed it. When someone sells their own properties to earn their living, they no longer pull comps with the agenda of getting the listing; instead, they pull comps to accurately reflect what the house will truly sell for. The difference can be enormous. I pull every comparable closed and active comp; sometimes there are only a few, other times there are 6-10. It's not how many you pull, it's that you pull ALL the most comparable listings.
Lindsay Berry yea I just bought a home it was on the market for 6 months
They went from 385 to 370 365 then I bought it for 354
I'm sure they were paying $2000+ payments
Also buyers see 6 months on the market and offer very low bids (like I did) because time was on my side.
And seller may get desperate or just want the peace of mind.
Good video on determining property values. We use the county tax roll only for information. Zillow prices are known to be off in our state by up to 10% or higher. The old saying that I was taught is, You can price something at any price but you have to have a buyer that wants it at that price.
I think everyone here online loves MR. Phil Pusterjovsky.
So many people have dreams, and Mr. Phil helps us to fulfill them faster.
Mr. Phil i sent you via post a cake...did you get it? Was specially baked by my gran mom.
Just joking...but one thing is clear. Well educated person and shares knowledge with others.
Thank you
Great video on valuing the property.
Phil, you forgot to mention FSBO's aren't on MLS, so like you said MLS with County records captures ALL sales for a complete analysis.
That's usually how the sales price appears on public records, it is based on the conveyance tax. However, as stated in the video, buyers of real estate can pay more in conveyance tax to make it appear as if you paid more for the property than you really did. The only resource that tells the correct information is the MLS
should i calculate property value based on average sqft of comparable homes OR based on comparable home prices average value?
@@rotcataergeht Neither. You should base it on comparing every aspect of the comps to your subject property.
this guy is the best and most honest teacher ive seen on here
Thank you for your videos. First time home buyers here. You answered more questions in 5 video's than other video's I have watched. Thank you for your time.
Alright, turn on the subtitle at 14:50 that pretty funny 😂
Love the vid tho Phil.
lol
Funny stuff. 🤣🤣
LOL
In the past I thought you were get rich quick. Now I know you are real. Thank you for your videos.
I have a more modern version of this particular video. Check this one out: ruclips.net/video/wQ643vPoGmU/видео.html
AGAIN! Phil, you have hit the nail on the head that much of the propaganda of real estate boils down to understanding the human psychology behind it.
Computers do not have human understanding OR intuition!
Thanks for another clear, transparent, communication.
-Future Seller 🙂
I agree on many of Phil's views in the videos I've seen so far. A few more comments: as he said the property appraisers (PA) don't have access to the property, and in part of the process in calculating value will measure the outside of the property. In the case of a 2-story structure, the PA doubles the SF to play a role in the assessed value. TRUE STORY: What happens when the home has a balcony overlooking the living area on the main floor? Looking outside at the roof line, the front part of the roof is much longer than the back? More than half of the upstairs bedroom area is not livable - but the PA office doesn't (will not in Lee County Florida) adjust the assessed value. The mis-assessment may become apparent when an appraiser goes inside the home and measurements are made. The result may be that the appraisal comes in lower than the assessed value.
Phil,
I didn't read all the responses to see if any of the following comments were made......motivation of the seller and buyer regarding the comparables is key. This would entail reaching out to the agents or buyers & sellers involved in the sale. If a sale is distressed in any way, it's not likely a good comparable. Driving by the comparables is also important to see if there are any external factors that may have influenced the final sale price (high tension wires, proximity to commercial uses, etc.). I could name a few more instances where the choice of comparables is complicated. Proper research takes time and a certain amount of experience. This explains why the entry level into real estate appraising is so high. (Minimum of 2 years and 2,000 hours of supervised training, plus a college degree AND 120 hours of class time! Oh, and a 6 hour state test.)
I have noticed, that within an hour of putting a house on the market, Zillows Estimate magically turns into the exact same number as what I listed it as.
True
The only thing wrong with sales price is that the sales price can be grossly overstated, especially in real estate (remember the real estate crash, and ensuing economic crash?). At one point, sellers were getting into bidding wars over properties and the final sales may have been way over the top compared to what it should have been, if the price had been grounded in something more repeatable, like construction cost for example, which wasn't even mentioned in this presentation. At one point, banks and realtors were very motivated to originate loans or sales at the highest price possible, again with no grounding in objective fact. In terms of assessing, "chasing the sale" is sometimes a quick way (read: less work) around actually determining the value. However, since this is about making money more than anything else, realistic values are not as important as high values, regardless what the long term economic pitfalls might be.
Great and informative video on determining a property value. Thanks for sharing!
Excellent video. Very good presentation style and language used, clear speaking, good pausing, good phrasing.
Great Videos. All new and old home owner should take a crash course from you before they buy any new home. Thank you again to helping the community!
So use MLS in conjunction with the records, find the owner and liens, then compare similar homes in the area (pros, cons of both) and work out a figure. Then you can double check vs redfin, zillow, trulia, etc, to see how accurate.
In person, the county records are free to search. But if you want to search county records online, some counties charge a monthly fee. Other counties provide all of their records online free of charge.
You also need to consider the extra amenities that comes with the home, such as in ground pools, decks, attached garage etc
And the types of building material used in construction such as brick facade vs vinyl siding, counter tops, walkways, tool sheds, bathroom materials, flooring materials etc. In the end the homeowner should set the price, not the agent. The agent should only find and do the comparisons and make the recommendation.
Good point Mr Hensley, but I had presumed that Phil was referencing primarily non-investment properties in this talk. And I agree with his reply that cap rates are a component of the final value. Market, location, age (economic life) - and other components - play their part as well. Good video.
Depends on how your Lease Option contract was written. Also, you can't do it if you are in Texas unless you follow certain strict guidelines. Texas doesn't like sandwich lease options.
Love your comment, "don't rely on computers". We need more people like you to tell that to the "powers at hand" trying to push the appraisal industry in that direction and force appraisers to be data entry clerks with fees to match.
Bingo on county records. As an appraiser of 19 years in Denver I have told agents time and again. DO NOT get property characteristics from county! But they don't listen. Appraised a home in an upscale Denver hood recently. Agent uses county for square footage, well after measuring the subject it was over 800 sf bigger above grade than what was listed. And by using the county numbers the property was under contract well below market value. Ya think the sellers were pissed off? People, consult with an appraiser, you're dealing with a large asset, it's a small amount to pay in the big picture. I don't need to provide a full blown Fannie Mae appraisal to help an investor or agent determine a list price.
Hello, enjoy your video. I'm neither an investor nor home owner, first time home buyer here :)
First position gets paid first, second position gets paid second, and so on. Some people have a first and second mortgage on their home. The first mortgage is the lien in the first position. The second mortgage is the lien in the second position. If there is another lien, it could be in the third position behind the first and second mortgage.
Banks are supposed to compare...unless they are hooked up to city mob and are dealing with a sheriff/mob resell trying to keep the tax value up but ruining credits when hit hits the fan. Rinse repeat, they even get kids dads to come over and work months and pay contractors helping kids trying to hold on so it works great for them sometimes. That is why insurance checks get written to owner and lender maybe(a little).
Back at it! Now in FL and hope to take your course cause I got the time and goals to move on my first deal...cant wait!
Great. Apply here: www.freedommentor.com/apprentice
I'm wondering if you can help me out?? We've looked at a house- it was built originally in 1902. That part is the kitchen, dining room/living room and 2 bedrooms and bath upstairs. Then they added on in the 90's to include a living room, master BR, master BA, 2 sided fireplace and basement. THEN, in the late 90's they added an INDOOR pool to the end of the house along with a bathroom, shower and sauna and an atrium area. It's beautiful and big but it HAS to cost a fortune to heat that pool!!! We've taken recently sold properties and broken this one down to try and get a price but... a house that was built that early and then had wings added on later... how do you compare apples to apples even? lol well, we did our best. It's also 150 acres so... we took the 50 acres and the house with outbuildings and pretended the pool was out of the picture. Then, figured for the other 100 acres of land. (the more you buy the cheaper per acre it is) and we figured those up then added another... $30,000 for the pool. I have NO CLUE what the cost of a pool is but I can imagine most people think it's cool but a definite money and time drainer. My question is this.... They want WAYYYY too much for it. Just under $1,000,000 but we're figuring $600,000. We've got our figures all down, what properties we looked at and came up with the numbers, etc. When we get to the point of making our offer, being it's SOOOO much lower, WHO do we discuss this with, of where we came up with this? Or does that matter? The owner is 81 and he was a lawyer. They're moving to assisted living so... IDK how long they want to wait for a buyer but... that price is WAAAAYYYY over anything else in the area. Should we sit down with our realtor who showed us the house and show her what we came up with? Have the seller's realtor find comparables and see what the realtor thinks would be best? how do you go about it when it's THAT big of a price difference? If he were to sell the house separately and each parcel of land separately, then he might get something close to the at price but... IDK. I'm just wondering what the best way to go about making an offer that different in price, would be. And it's been on the market for almost a year and 1/2 now for different prices with different amounts of land- there's 300 acres total but now they have it with 150 acres. Sorry for rambling. lol Can you help at all?? Anyone?? Thanks for the great videos!!!
Tara Owen I would suggest writing a personalized letter to the owner explaining the situation in the kindest way possible and including all the research and comps in the area you have found trying to in essence explain to the seller why your offer is so much lower than the asking price. Everything is negotiable. Good luck
Thank you for your help and advice! It really helps and...builds my confidence with this profession.
Informative video but a big factor in valuing a property of course is its condition and cost of renovation. This is where the average owner or potential buyer is usually at a disadvantage. Property's true value = comparables minus the renovation cost if the property condition is a negative.
Thank YOU SO MUCH for sharing all of your knowledge!!! You are an AMAZING speaker!
I am amazed of all your tremendous great information,you are definitely a great instructor I’m just soaking in all your knowledge. Thank you.
What if you can't convince a real estate agent to help you get access to the MLS. How do you do accurate comparable?
Either get your license, or find an agent who will give you their access.
@@freedom_mentor Thanks for the reply Phil.
This is a great video to share with clients, thanks for simplifying it.
You ROCK Phil! I've been on the fence since I bought my first rental property. Not so much anymore thanks to your videos!😀😁😁😁
Hi Phil.
Best ever explanation on where and how to determine the value of a property!!!!! I have been comparing websites like Zillow and Trulia for my properties and have found the sqft of properties listed by them, most of the time differ from what it is on the county records. Whose sqft is the best one to use, then as you did mention these sites are not the best ones to use for comps.
You also say we, investors, can access the MLS for free. If so, then I don't need a REA to sent me the CMA of a property? Or even if I can't access the MLS, my best source of getting the best comps for my property is via the REA?
Thanks again for a great tutorial!!!
Excellent!! Quick question when u r selling a house n say it’s a one story and the only 2 to compare in the same subdivision n both are two stories w/ all the same features such as bedroom and bathrooms granite backsplash etc how will that compare to my one story house during appraisal? Thanks
One story is more valuable.
Phil Pustejovsky thanks for the reply, true. But when the appraisal comes to property site what will they compare to? Will they compare to those 2 stories that were sold 6 months ago or will they go out from my subdivision n try to find another 1 story with same features n compare it to that ? Will they even consider the price sold on the 2 stories as comparable? Thank again!
That will depend on the appraiser. @@kush4u786
Thx Phil. I definitely was one of the clueless investors until now
Thank You Sir for taking the time to coach others. 1 question: would it be better if i use my own cash to purchase an investment home for flipping purposes than getting a loan ( given I have the cash available) thank you Sir.
Depends on how strong the return on your investment would be.
I just started in Real Estate and I partnered up with a friend who has experience and has flipped 4 rehabbed houses. My father who is a PM at the port authority, said he would help me buy lots and build a house from scratch. In your opinion what would you say the best option for me. Rehabbing houses or build from scratch?? I understand both have their own problems and have their own risk reward
Rehab existing is ALWAYS better than building from scratch so long as you buy rehabs wisely.
I have used MLS and it didnt come in true, as you said the area I was looking at was much different from one or two blocks away, true info, James Bischoff
The one thing I never understood about valuing a property is why don't people compare neighborhoods from all over the city or say neighborhoods that are 5-10 minute drives apart. Appraisers only seem to stick to nearby neighborhoods that are similar for valuing property and homebuyer's seem to trust them. If I'm a homebuyer looking for a house, I will look in multiple places in a city at similar homes to come to a value. Shopping for homes around a certain neighborhood is like shopping for cars at dealers within a 3-mile radius.. If you go to the other end of a city you might find a dealer selling the car a little cheaper. It's not always easy to find comparables in a small radius especially if no homes sold recently. But if you go across the city to a similar neighborhood, then voila! You can get good comps!
+robertoospina10
Good point, just remember Location, Location, Location.
The problem with your analogy is that location plays a huge role in price. Even "comparable neighborhoods" if they are in opposite sides of town can command vastly different values, due to different factors (nearby amenities, highways, shopping centers, schools, etc). That's why it is important to stick to nearby (and truly comparable) areas to get the most accurate estimation.
robertoospina10 No. u WANT to remain within one mile of your subject property, at most. If u go too far away from tha property that youre looking for comps for, that neighborhood could very well be valued either much lower or much higher, which will certainly screw your comps...Good comps are:
1. Similar in sq footage within + or - 10% of subject property.
2. Similar in condition regarding amenities/upgrades.
3. Within same area. This can get veeeery tricky. A property within tha SAME zip code/area, even within one mile of subject property, can be valued veeeeery differently if perhaps it is across a freeway, across railroad tracks, is part of a new subdivision, ect. This is where knowledge of your market is crucial....
4. Ideally sold within last 6 months. This will be different for luxury properties. Very different....all of tha aforementioned.
robertoospina10 because you are not a Typical Buyer
I just saw your question. In 2007 I was a realtor, for a brief period of time. One of the things newbie realtors do is to "sit" at open houses for the more experienced realtors. It gives the newbs experience and the veterans can goof off on the weekends. OK, fine.
I happen to live in a particular area where the schools are rated 2nd in the state (CA) One time I sat for an open house for another realtor, at a house that was pretty much identical to the one I lived in at the time. But it was in a different school district, and the other school district was......uhhh, sketchy. Not that well rated. The houses had had about the same number of sq ft, lot size beds/baths, size, style, condition, without question within $20K or each other. The house I lived in was valued about $125K-$150K more than the one I sat at. Due to school district. (As it happens, as a selling realtor in CA you CAN NOT say that one house is in one school district over another but that does not mean that buyers cannot research that and come up with their own conclusions. And they do, and will) The lower valued house was actually in a tiny bit better neighborhood. The houses were within about 4 miles of each other. Just sayin' the difference in values was pretty striking.
I would like to know which method of property valuation between the investment method and the direct comparison method is the best to use to value landed property in a depressed market?
Sometimes I see houses listed on sites like Zillow listing 0.75 bathrooms, and on this one property the county (also Volusia) has it listed as 1 bathroom. I've seen the house and it is a full bath. What is 0.75 bathroom anyway, a bathroom with a toilet, sink, shower but no tub?
I don't know. Google it. "What's a 0.75 bath?"
A .75bath- is a bathroom with a sink, toilet, and shower, but no tub.
If the property value with buyer and seller realtor was 180k, would it be wise to offer 6% less, that is 170k if its a FSBO?
At least, if not much more.
Thank u phill .... For your teaching ....God bless you 👍👍👍👍
We have made a ton of money in Texas. If you are accepted into our program, we would have you do deal right there in your own hometown. Everything is bigger in Texas, as they say, and oftentimes that includes the profits as well!
Thanks Phil! Your explanation was clear, engaging, and helpful!
Good central point of not relying on computers and algorithms to do your analysis. But the income and cost approaches to valuation are very important and shouldn't be overlooked, especially for investors who are presumably using buy-and-hold and/or fix-and-flip strategies.
Income approach only truly applies to commercial real estate. Even 2-4 units rely on comparable sales analysis for valuation.
True, from an appraiser's perspective the comparable sales approach is usually weighted more, even on a 4 unit investment property. But there's a section on Fannie's small income property appraisal forms to analyse the income approach, and some appraisers place at least some weight on that approach when rental data is available. But what I'm saying is, investors considering a buy-and-hold strategy should place some weight on the income approach and more emphasis on a property's net operating income, regardless of what an appraiser considers. Of course, I'm biased, being from the SF Bay Area, where buying with severely negative cash flow (and often with protected, rent controlled tenants) is commonplace, because people are content to go off comparables and bank on appreciation. Scary Stuff.
Phil you may not get this but really thinking about trying to become a mentee. Do you already have too many people in the Pittsburgh Pa area? You are so knowledgeable and i feel that you are actually someone in the real estate teaching field that is trustworthy If it wouldn't work out i have learned precious information already. I found you about 2 weeks ago and have already watched 70% of your videos in my spare time. Thank you thank you thank you.
We have an opening in the Pittsburgh area. One of the few places left in the state of PA.
Phil, can I use this video in a blog with your credit?
Thank you for sharing you knowledge. I'm just starting out and you have really help me to understand.
I live in Volusia County too! Great video 👍
Thanks! How is your market doing?
Great info. By me being very new to real estate wholesaling this is were I am more confused on. How to value a property the right way. It makes a little more sense but I still need to gain more knowledge before getting my first deal.
Good advice. Very interesting. Thank you .
Just subscribed.. you’re a smart teacher Phil
Comps are excellent for single family, but when comparing multi-family sales in my city, the few properties I can find are all over the chart. Plus those aren't usually direct comparisons.
+Josh Thomas Commercial is appraised based on income far more than by comparing sales.
+Phil Pustejovsky So how to do you base your numbers if the multi-family is not currently preforming? i.e. needs rehab to get up to 'market rent', plus only 1 of 3 units is even currently rented. Would you use the current rental rate, figure percent that cash flows and your own ROI? Something like 12 * (current rent * percent rent that cash flows including vacancy ) / ROI
+Josh Thomas When negotiating with the seller, use the current rental income :) When estimating your income, use pro forma numbers.
Great video, Phil! Thanks so much for sharing your insights. One question: in your opinion, what criteria should investors use to determine reasonable comps on the MLS?
# 1 is proximity to the subject property.
Your the man phil.
Buyers determine the property values in that property is only worth what someone is willing to buy at and the vendor is happy to accept...previous sales of similar property in the same area only reflect what other buyers(who are now out of the market) have paid to live or own in the area. It does not reflect on how well the property was negotiated, the condition of the property and the vendors need to sell. Actual prices received vary at least 5% to 7% + or - at the very least...just sayi...
Although you are right, try using that argument to any bank in the United States. They aren't buying that logic. Instead, they will only loan based on purchase price or appraisal, whichever is lower. And appraisals are based on previous sales. And most real estate sales involve a loan. So if you want to determine your property's market value, it is unfortunately tied to previous sales, not necessarily what someone else will pay for it. Right now, across the country, sales prices are exceeding appraisals (I'm watching it happen almost every day) and sellers are being forced to reduce their prices in order to sell even though the Buyers were willing to pay more.
Hello,
I have run across a house built in 1981
burned down and rebuilt in 1997. How do I comp or what do I comp it against
when everything around it was built in the 80s. Just heard you mention the same scenario as I was writing this.
" Take to the mls not the computer"
is what I heard. Does that mean to go
through mls finding homes with the
same criteria no matter where they are.
Location is a factor in pricing, what about that. Do I have to find out what the
market was like back in 1997. Please
help straighten me out. Am I too far out on a limb. Whatever you have to say would be helpful. Thank you.
Denise
Comp it to the ones built in the 80s. But that subject property will sell for slightly more because it is 10-15 years newer
Great analogy using cell phones. If people actually took your advice in shopping for cell phones and comparing them they would not pay $1,000 for an iPhone or a Samsung Galaxy when they could get the same phone from Motorola for $200. That's like paying a million dollars for a house that's worth $200,000 because they didn't bother shopping around for houses.
People do this all the time when they buy a house in a gentrified area when they should instead be buying a house in an area that might be the next gentrified area.
How could I compare properties . Buy how much the houses are being sold around them ?
Watch this video: ruclips.net/video/wQ643vPoGmU/видео.html
Take away - Look into MLS
MLS - Multiple Listings Service
More specifically: Each MLS is independently owned. You'll see the checks/balances that keep the tax assessments from being 100% False. Also, updated Sq/ft, bedrooms, etc. MLS is a good place to start for "real" home values.
P.S.
County records helps shows leins and negative debts on the property. (combo of both is best)
Hey Phil, is the Realtors Property Resource a great way to determine property value?????!
For the areas where the local MLS has allowed that system to suck the data out of the true local MLS and into RPR, it can be helpful, but still not as good as the actual MLS. I use RPR in a pinch where I don't have MLS access. The issue is that not all local MLS systems link up with RPR even though it is part of the NAR.
He's so animated! I love it! You got yourself a new sub :-)
You give a great video, awesome energy. I found you while trying to come up with a list price for a home built in 1926 with no comps! I'm over here in Sarasota :-)
I’m from the future, they now have the MLS 😂- &great info, thank you so much ✨
Hello! You're welcome.
When finding out the ARV of a property, you look at surrounding similar sold comps. But some comps are of properties that have been bought by other wholesalers or that are still in need of repair while others are after repair. So how do you know which ones to use in your calculation. In other words, say I have a couple of properties that are 42-55 a sq ft and the pictures of those properties look like they are older properties (of around the same age as the subject property) , and then there are other properties that are 100-112 a sq ft and are newer (more recent builds), then do I use the comps of the older properties just because they are closer in age to the subject property?
Connect with a local appraiser and pay him to teach you how that is handled.
@@freedom_mentor well yes that is always an option, but id like to know what you would do
phill really like your uncomplicated concept in PROPERTY VALUE the holy grail of real estate thanks frank
Phil, When you make comparisons on other homes, does land play a factor also? In other words if I have a house on an acre of land but it's an older home and I don't have a garage or walk in closets, but have upgrades in kitchen and bathrooms and finished upgraded attic,.does that play a factor in the value? How can I determine what the difference between a new house for 300,000 that has all the bells and whistles but no land or a house that is 30 years old, has the same square footage, upgraded kitchen, bathrooms and new roof with a lot of land. Can you help me determine that?
Lenore Manns All of those factors play a role. A local appraiser could educate you on how those different facets adjust the comparable sales up or down.
Phil Pustejovsky Thanks Phil. I was hoping that this was something I could figure out myself. I thought that was the purpose of this video, which I find very informativie. A realtor can also appraise my home, but I wanted to avoid having to pay the 6%. I'm getting educated by your website.
Thank you so much for sharing such useful data! Greatly appreciated.
For comparable sales data give a realtor $25 for a list of comparable sales in the range of value for homes similar to the subject.
Thank you this was very helpful and informative 👍👍
Do you know how to get Zillow to correct the market value of a home listed for sale? A home I have listed is well below market value. Please advise. thanks.
Contact Zillow
Hi Phil
As a newbie please excuse an obvious question--would a buyer's agent give you this valuation without the leg work, or would you, as an investor, forego a buyer's agent?
I had an interest in a property I thought might sell for 45K ARV-an agent I spoke with seemed very knowledgeable of the zip and said more like 37K.
Your advice?
A buyer's agent can certainly provide an opinion. But ask yourself this question...how does a Buyer's Agent get paid? When you buy. So they have an inherent conflict of interest. The best and most successful real estate investors do their own evaluations. Sure, you can take input from buyers agents, appraisers, etc, but ultimately, this "leg work" is the most important leg work you do on a deal. I spend more time doing this than any other part of my real estate investing business. And every minute I spend doing it is time well spent.
Phil Pustejovsky Thanks for your reply! I'm learning exponentially from your videos.
Regards,
Noel
Thank you Phil for that incredible content. I just stumbled across your channel today and I am amazed of that quality you putting out here. This is highly appreciated!
Hi Phil...Your training videos are very helpful. Thank you.
Jimmie Reed
Thanks Phil, Love the videos, well done! If you'd like any assistance in NE Florida let me know, I'd love to learn and work with you.
Awesome video heaps of good tips in here.
Very interesting way to explain a very hard topic. I will follow those steps to determining the value. Thanks and keep on
Phil why do people get their real estate license? Is this only for when working with a broker or renting out a property?
Watch this video: ruclips.net/video/7vS9basu8uc/видео.html
@PhilPustejovsky
I was just wondering, after watching some successful individuals, who have been wholesaling properties for quite a while.
And they use an established ARV system, should a real estate wholesaler utilize the same ARV system in Canada?
Or should there be some sort of adjustment made, because Canada's real estate market is over inflated by %65?
ARV system fails consistently. Don't do it that way if you want to be much more successful then the ones you are learning from.
@@freedom_mentor
Thank you, I appreciate your advice, help
You are very knowledgeable seen a couple of your videos... great advice and to the point. Subscribed! :)
Hi Phil, I have a question. I have a house in Idaho, which I urgently need to sale. You say that the information on which the value of the house needs to be based is obtained from the county office (tax assessor and register of deeds), right? now, is this some information that my potential agents are suppose to collect from the county office? or am I supposed to provide them with that information while they extract the other half of the info from the MSL? Also, if I am the one supposed to request the information from the tax assessor and the register of deeds, am I supposed to also request the information about the comparable houses in the area? meaning, the part you were explaining about whether a house has liens on it, who owns it, etc. Will the county office provide me with that information without any issues? or will they only give this info to the real estate agent working on the selling of my house?
+Amy Gavin This video tries to explain the weaknesses in public records data such as the County Register of Deeds and the Property Tax Assessor. The MLS is the only source for truly accurate data and only real estate agents have complete access to the MLS. If you are selling your house, your MUST watch this video. Watch it twice: ruclips.net/video/c5Lk0FNKRg8/видео.html
Thank you so much for your clarification Phill, I appreciate you taking the time to answer my question.
Now, if you don't mind, would it be ok for me to ask you another question regarding the selling of my house?
This house I'm wanting to sell was $132,000 when I bought it 9 years ago. Even though I have spent roughly $90K on it so far, 66% of those $90K have gone to pay interest and other additional fees, which is the reason why I have only paid in reality $31K towards the principal. Now, my question is, once I sell that house, what quantity will I actually get back? will I get back only the $31K I have paid towards the principal? or will I also receive the $60K I have paid towards interests and additional fees?
Thank you again for your time and patience.
V/r
Amy.
+Amy Gavin you will get back the difference of market price (what your home sells for) and settlement expenses (escrow, fees, recording, commission if broker transacts, any concession you may offer) plus your mortgage payoff.
Really good information buddy 👍 thanks 🙏
Tje #1 reason people buy is school district. Even private school buyers will ask. #2 is kitchen and #3 bathroom.
What is your opinion on buying mobile homes and renting them out where I live you can rent them out for about $1000\per months
+Kris Danielson They can be cash flowing machines
They can also be money pits. Depending on where they are located I would suggest owning the land and not spend the money on a lot space rent.
Wish this guy was my personal genie.
You've got 3 wishes.
Phil you did it AGAIN. 👏
Phil, I'm trying to do a title search in Madison County Alabama, and the system is an arcane nightmare.
First, the county departments list did NOT include either a recorder or register of deeds. After looking around awhile, I finally found the office that allegedly has deeds, etc.
But when I tried to do a search, there was NO WAY to do a search for a specific address. The site had all kinds of search categories, but none that seemed promising to find the deed for a specific property.
Help! Is there something that I need to know that I'm missing here? Thanks.
Watch this video: ruclips.net/video/6p5opEuswPg/видео.html
Phil Pustejovsky Thanks much. I'll check it out.
Arn't professional appraisers accurate on what the value on property should be?
They may have an accurate report based on the closed comps they used to create the report, but the number they determine may not precisely measure what the house will sell for in the real world. Appraisal and actual market sales price can be two very different things.
Thank you.
I live in volusia county Florida too and was looking for this information!!! Kind of funny.