Convincing sellers to NOT overprice their homes by making graphs

The market is overpriced. So if you are a real estate agent trying to communicate with sellers, how do you get someone who wants to test the market at $500K to realize a more reasonable price is $375K? There are surely many strategies, but today I want to mention the power of graphing neighborhood sales. I don’t mean to beat the dead horse by bringing this up again, but knowing how to graph will help you communicate effectively, stand out from other industry professionals, and seize your role as a market trend expert instead of letting Zillow have all the glory. Sure, you can show your client a graph of city or zip code trends by using Trendvision, but it’s hard to argue with neighborhood-specific data.

making graphs - image purchased by sacramento appraisal blog

A letterhead to give your sellers: Before we dig in, here is a letter I wrote for sellers about things to consider when pricing in this market. This letterhead is based on a post I wrote recently, but I tweaked a few things. See the image below and DOWNLOAD here (PDF). Feel free to email or use as you see fit. Obviously the letter does not address a specific property. If you need a letterhead for your specific property, let’s talk about some consulting.

letterhead

Excel Tutorial: I know, you don’t use Excel because it’s only for nerds. But let me break it down for you below so you can join the club. Previously I shared a tutorial on how to graph with Gnumeric, but I had a few requests for using Excel instead since that’s what most people already have on their computers.

land park two-bedroom graph example by sacramento appraisal blog

This graph shows the range of similar-sized neighborhood sales is between $300-375K for the most part (instead of $500K). This can be a very powerful visual, especially when you begin to show the sales at $375K have been remodeled.

A tutorial on how to show the market: I recommend watching the tutorial below and then pulling up some MLS data for a neighborhood you are working in so you can create a graph by following the steps I took. This is perfect for Sacramento MLS, but as long as you can export data from your MLS system, you should be okay too. You may need to pause my video several times or rewind at moments. Whenever we do something new, it takes a while to catch on. If you don’t have Microsoft Paint to paste the graph like I did, you can use a different photo editing program, or maybe use a snipping tool on your computer. Additionally, you can open up Paint and simply start a new file, and then paste your graph (as opposed to opening an existing photo like I did). Watch below (or here if it’s too small below).

Please let me know if you have any questions. I hope this was helpful. Perhaps this will spur on a new skill set for you that can make a difference in your business.

Questions: Was the tutorial helpful? Anything you need clarity on?

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The scoop on the value of neighborhood trees

I read a short article last week entitled “City Trees and Property Values” (pdf) by Dr. Kathleen L. Wolf after hearing a representative from the SacTree Foundation speak at a Realtor event. Dr. Wolf’s research shows that trees generally increase property value. Her study indicated a 2% price increase for a property with a mature tree (greater than 9 inches thick), 3-5% increase for trees in the front yard, and 10-15% increase for mature trees in high-income neighborhoods.

While initially some of her stats seem startling, I do think she is right that trees add to the overall value of a property. This doesn’t mean a house is automatically worth 2 or 9% more due to having the tree set-up she mentioned, but trees generally do yield a value contribution. In an objective sense, trees add worth due to boosting energy efficiency due to shade, while there is also a subjective element where they tend to increase curb appeal among buyers. It’s hard to ignore that some of the most highly priced and sought-after streets in the Sacramento area are lined with enormous trees. Think the Fabulous 40s, Curtis Park, Land Park or Arden Park to name just a few. Granted, these streets typically have very large and well-maintained houses too, but there is no mistaking that a canopy of mature trees stretching along a particular street tends to give a very positive impression to buyers in the market for that street in comparison to others. Agree? Disagree?  

Here is a video of Jacobe Caditz with the Sacramento Tree Foundation speaking about the benefit of trees last week at the Sacramento Association of Realtors.

What do you think? How have you seen trees or a lack of trees impact real estate value? I’d love to hear your thoughts.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook or subscribe to posts by email.