This spring is setting up to be another optimal time for sellers in Baltimore.
The current figures are showing that the current active inventory is down by nearly 10 percent compared to the same time last year. With the decrease in number of properties available, sellers are trying to take advantage of the low inventory, and the numbers show it. The average sale price for the Baltimore Guide area (21224 and 21231) is up $15,000 over last year.
For buyers, the lower inventory means fewer properties from which to choose and paying a higher price for the properties that are available. For sellers, it means less competition and more ability to dictate sales prices.
Sellers don’t always have the final say in the sale price of their properties. Most buyers are looking to obtain a mortgage on the property; part of obtaining that financing involves the lender getting an appraisal, which helps the buyer and lender ensure they are making a wise investment.
If the appraiser determines that the property is not worth what the buyer is willing to pay, the seller often has to decrease the price of the property in order for the purchase to happen. If no agreement can be made, the property will go back on the market, awaiting another buyer. Basically, this means wasted time for both the seller and buyer.
The goal for sellers in this type market, then, should be to obtain a price high for the area, but not so high that buyers are unable to get financing for the property. It’s great if you can convince a buyer that the value of your property is high, but you will also have to convince their lender of the value too.
The best way to determine your property’s value is to look at recent sales. It gives you a measuring stick and tells you, “This is what an actual buyer was willing to pay for this type of property in this location.”
In Baltimore City, it’s likely that there is no property exactly like yours, but as long as the location and size are similar, you can calculate the rest. Values for items like parking, roof decks, and granite can be calculated; however, it is best if you can find properties that are similar in all aspects, including these.
The lesson here is that with the low inventory, you can get more for your property, but you can’t obtain an unjustifiable number. Aim high but keep it within reason.