Home buyers are constantly perplexed on the question how home prices are determined. Generally, the value of a home is determined by the location, age, size, type of housing and the condition of the home. A home seller on consultation with his realtor used comparable market analysis to established the listing price for a home.
When a property is listed and priced accordingly, it will result in home buyers viewing the property and finally a sale and purchase contract is negotiated.
For example:
In Richmond, BC the price history for the Timberwood Village Townhouses to-date confirmed that ultimately, the market price of a home was determined by the the buyer and the seller. These homes differed in size, type (middle, end or detached) and conditions.
| Unit No. | Size | Type> | List Price $ | Sale Price $ | Sold Date | No. Days | Price/ sq ft $ |
| 17-6871 | 1,670 | End Unit | 449,000 | Active | Active | Active | Active |
| 88-6880 | 1,490 | Middle | 389,900 | 381,000 | 02/07/08 | 67 | 255 |
| 78-6880 | 1,602 | End unit | 438,000 | 432,000 | 15/06/08 | 45 | 270 |
| 44-6871 | 1,600 | Detached | 429,000 | 410,000 | 13/06/08 | 22 | 256 |
| 86-6880 | 1,509 | End unit | 415,000 | 409,000 | 14/04/08 | 13 | 271 |
| 9-6871 | 1,450 | Middle | 389,000 | 381,500 | 12/01/08 | 42 | 263 |
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Buyer & Seller Motivation
The final selling price of a home is established based on the "motivation of the buyer and the seller". If a seller is very motivated, he or she may be more inclined to accept the priced offered by a buyer - even the price may not be what the seller hopes for.
Conversely, if a home buyer is really interested in buying a home he or she likes, the buyer will be motivated to accept the final price countered by the seller.
From a home buyer's prospective, when a suitable home is located, it is a matter of negotiating the best price possible. The buyers and sellers negotiated the best prices they could get, sealed the deals and moved on with their lives.
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James Wong Richmond BC Realtor > Richmond Remax Realtor> Remax Westcoast > Richmond homes for sale, Richmond BC townhouses, Richmond BC condos > Vancouver mortgage broker > Richmond mortgage broker.
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We do a cma as if we are the appraiser for the property so the seller can see reality. I have had 2 deals struggle with low appraisals this year, but we knew it before hand so the struggle was mitigated.
Well said Heath. Buyers and sellers always have to deal with and make the best out of the situations they are confronted with. Getting an appraisal done even a simplified or drive-by is a big help. There are some home owners who are willing to spend the money themselves to find out how much their homes are worth before having their homes listed.