"Oh, but our house is much nicer than that one ..."

Sound familiar? It sure does to me (and not necessarily in reference to my own house, given my lack of ability as a handyman.) One of the biggest challenges I face when working with sellers is setting a listing price for their home.

In a sellers' mind, the listing price depends greatly on many factors, in many cases in this order:

1. How much they paid for the home
2. How much they've spent in upgrades
3. How much they've spent in landscaping
4. How much time and effort has gone into the upgrades, landscaping and upkeep
5. Unique features of their home
6. Comparable sales

As a real estate professional, however, the list looks a little more like this:

1. Market conditions
2. Comparable sales
3. Features and upgrades

The price paid for a home clearly is important, not so much for determining a price but more often in deciding when to sell. If there isn't a sufficient profit margin and there's no immediate need to sell, putting your home on the market may not make much sense. (Of course, if you bought your home before 2005 in the Phoenix area, you probably have a substantial paper profit right now.)

The next four items on a sellers' pricing checklist (some objective and some emotional) often don't carry nearly the weight a homeowner may expect. And that's because the most crucial word in the phrase "real estate market" -- market -- often is overlooked.

Home values are subject to the state of the market, just like the price of a stock or mutual fund, just like the price of gasoline. Supply and demand determine to a large degree what price a seller will receive for their home.

In a sellers' market, where there are far more buyers than sellers, almost every upgrade can be reflected in the listing price. Recent sales provide a rough guideline, but as we saw in Phoenix last year, neighborhood averages served merely as starting points rather than hard and fast ranges.

Fast forward to today, where Phoenix now is a buyers' market -- a sizeable surplus of homes on the market and fewer buyers than a year ago (how many fewer is up for debate.) In a market like this, the comparable sales and market averages are the dominant factor.

The only upgrades that most likely will lead to a higher sales price are a 3-car garage, a larger lot, and a pool or spa. Most everything else -- tile vs. carpet, granite counters vs. corian, etc. -- can set a house apart in a buyers' mind. But they're not necessarily providing a high return on the investment in the upgrade. All but the most particular buyers can justify lower-grade counters or flooring for a better deal on a home.

By pricing a home above the market averages, a seller is giving the buyer an open invitation to determine the home's overpriced -- the one upgrade not done will emerge in a buyers' mind as proof that the home isn't worth the list price.

Selling in a buyers' market isn't impossible ... it just takes marketing and exposure, which your real-estate professional will provide, and reasonable pricing, which you need to work with your real-estate professional to determine.

For more information about the Phoenix Arizona Real Estate market, visit me at www.DaltonsAzHomes.com!

Realtors® Help Consumers Remodel With An Eye Toward Resale

WASHINGTON (December 21, 2005) – Kitchen and bathroom remodeling projects are returning more of a homeowners investment than ever before, according to the 2005 Cost vs. Value Report published by the National Association of Realtors in REALTOR® Magazine and by Hanley Wood LLC in Remodeling magazine.

Many homeowners who complete midrange bathroom remodels can expect to make money; the cost on a national average for this project is $10,499, and the return is $10,727, or 102.2 percent, compared with 87.5 percent in 2002. On average, major midrange kitchen remodels cost $43,862 and return $39,920, or 91 percent of the costs to remodel, up from 66 percent in 2002.

Nationally, homeowners who add an attic bedroom spend an average of $39,188, and on resale, they recoup 93.5 percent of the cost. Master suites, however, do not fare as well; an upscale addition, which costs $137,891 on average, returns only $110,512 on resale, or approximately 80.1 percent of the remodeling expense.

The Cost vs. Value Report includes information provided by NAR members about the resale value of common remodeling projects in 58 U.S. housing markets. The report includes cost data, resale value and percentage recouped at sale for 18 projects, including a first this year: a home office remodel. Given that Americas homeowners spent more than $139 billion on home improvements and repairs over the past year, according to data from Harvards Joint Center for Housing Studies, the report contains valuable information for anyone who is considering embarking upon a remodeling project.

Realtors® have industry expertise that goes beyond the initial real estate transaction, said 2006 NAR President Thomas M. Stevens, senior vice president of NRT Inc., from Vienna, Va. Our members experience and familiarity with the communities in which they work make them valuable resources. They understand what makes a good home investment, whether their clients are buying, selling or remodeling. Realtors® not only sell housing; we also build communities.

The desirability of different remodeling projects varies by region and metropolitan area. In the West, window replacements are highly valued, perhaps due in part to insulation and cooling concerns in desert regions, with nearly 103 percent of costs recouped on sale. Westerners also prefer remodeled kitchens and basements; in this region, for example, a minor midrange kitchen remodel may return 112.3 percent, and a basement remodel is estimated to return 108 percent.

In the Midwest, however, the same kitchen and basement projects return only 85 and 73 percent, respectively. Midwest buyers appreciate homes with updated siding; midrange and upscale siding replacements return 96 and 98 percent of the project costs, respectively. Siding replacement projects fared well at resale in all four regions, likely because new siding is a relatively inexpensive way to update and refresh a homes curb appeal.

Buyers in the South are partial to upscale bathrooms, which return an average of 98.5 percent of project costs. When considering resale value, however, Southerners may want to think twice about midrange window replacements; this improvement, which is so popular in the West, only returns an average of 83.7 percent of project costs in the South.

In the East, a midrange attic bedroom addition returns an average of 98.1 percent at resale, but a home office remodel only returns 75 percent. In fact, remodeling projects that involved home offices were among the lowest returns on investment across all four regions.

Local and regional differences in the resale value of remodeling projects are not surprising – the desirability of certain home features varies by neighborhood and is heavily influenced by buyers expectations in a given area, said Stevens. For example, adding a bathroom to a one-bathroom house in a neighborhood where most homes already have two may not return as much as remodeling an outdated bathroom in that same community.

In the final analysis, however, homeowners who are thinking about a remodeling project should consider their own needs and desires as well as those of the homes future inhabitants. Keeping up with the Joneses can be a savvy investment move, said Stacey Moncrieff, editor, REALTOR Magazine. But ultimately, the best reason for a remodel is to enjoy it.

Article courtesy of Realtor.Org.

For more information about the Phoenix Arizona Real Estate market, visit me at www.DaltonsAzHomes.com!

FOR IMMEDIATE RELEASE

GLENDALE, Ariz. (Jan. 10, 2006) -- Jonathan Dalton, REALTOR and e-PRO with Century 21 Arizona Foothills in Glendale Arizona, and owner of DaltonsAzHomes.com, today announced an opportunity for unrepresented sellers to advertise their homes with a no-cost, no-obligation Internet listing.

"One of the keys to selling a home is exposure," Mr. Dalton said. "Regardless of price, location or condition, a buyer can't purchase a house he doesn't know is available. Yard and directional signs, and newspaper classified ads don't give unrepresented sellers enough exposure."

According to a 2004 National Association of REALTORS survey, nearly three-quarters of all home buyers begin their search on the Internet. And while other real-estate agents and firms offer Internet advertising, Mr. Dalton said few can offer the targeted, focused advertising that's available on DaltonsAzHomes.com.

"DaltonsAzHomes.com places among the top 15 sites on Yahoo! for several different searches involving Glendale, Peoria and Phoenix Arizona Real Estate," Mr. Dalton said. "My site also is well placed on MSN. Buyers using a search engine to search for Northwest Valley real estate are likely to find DaltonsAzHomes.com and the homes we advertise."

Under the program, unrepresented sellers can advertise their homes on DaltonsAzHomes.com for up to 60 days free of charge. They also may renew for an additional 30 days, again free of charge. Buyers who find these homes on DaltonsAzHomes.com will be directed to Mr. Dalton, who then will represent the buyers in the transaction.

At the time of the offer, if the buyers have not signed an Arizona Association of REALTORS Buyer Broker agreement, the sellers will be asked to complete an AAR-approved For Sale By Owner compensation agreement.

Additional information on this program is available by e-mailing Mr. Dalton at FSBO@DaltonsAzHomes.com or calling him at (602) 502-9693.

Mr. Dalton is a multi-million dollar producer who specializes in the Glendale, Peoria, Surprise and Phoenix Arizona real estate market.

For more information about the Phoenix Arizona Real Estate market, visit me at www.DaltonsAzHomes.com!

As I drove around Glendale and Peoria today, I saw a large number of homes being sold by unrepresented sellers (or For Sale By Owners, if you prefer.)

While I was amazed by some of the prices being asked a year ago, the ultra-heated market here in Phoenix seemed to justify almost any price an owner can name. But even now, with the market swinging violently from a sellers' market to a buyers' market, and with properties remaining on the market for weeks or longer, unrepresented sellers continue to try and jump ahead of the going market price.

Research has shown pricing a home above the going market is a risky strategy. The bulk of activity on a home comes in the first two to three weeks it is listed; the longer a home is on the market, the longer it takes to sell. Buyers already are looking at homes with a critical eye, unsure whether the home they're viewing is worth the price. Raising that price above what even the market dictates only heightens the uncertainty.

What many homeowners find, and what I'm afraid many of these unrepresented sellers will discover, is if the market does not pick up appreciably in the next few weeks, they may be selling their homes for less than they could have had they priced the home right in the first place.

And their net proceeds possibly will be lower than it would have been had they consulted a real-estate professional in the beginning.

Interested in what your home is worth? Click the "Your Home's Value" link at DaltonsAzHomes.com or e-mail me at info@DaltonsAzHomes.com for a no-cost, no-obligation evaluation of your area's market.

For more information about the Phoenix Arizona Real Estate market, visit me at www.DaltonsAzHomes.com!