How to Determine the Value of Your Condo for Sale
We’ve received queries the past week on what’s the best way to determine the sale value of your condo. I’m not surprised that many Bangkok condominium owners (and buyers too!) are unaware of the answer. After all, we tend to leave it to Bangkok real estate agents to do the math. All what we’re concerned about is the price, aren’t we?
But knowing how much your condo is worth is a critical process when you want to sell your condo, build equity on your property, or buy another condo. After all, you don’t want to sell your condo for more than its true cost or else, you’d never find a buyer. On the other hand, you won’t be willing to accept a lower price for your Bangkok condo for sale either even if can sell it quickly.
The best way to determine the value of your Bangkok condo is through the comparative market analysis or CMA. It will provide a comprehensive analysis of the comparable properties in the community and how their values will match closely to your property’s value. Bangkok condo sellers can effectively set an asking price that is in close approximation of the condo’s real value.
Typically, your Bangkok real estate agent is the best person to prepare the CMA to determine the top value for your condo. If you want a better estimate, you can hire a professional appraiser but be ready with the services fees that you’re going to shell out.
So how do they come up with the CMA?
The first step is to have your Bangkok real estate agent visit your property. Your condo will be examined and the agent will take note of its condition, the recent upgrades that you’ve done and all other factors that are needed to better compare your unit with others.
Next, the Bangkok real estate agent will examine the sales history of comparable condos that have been sold for the past few months in the same building or nearby condos. Ideally, there must be at least five comparables to generate a good estimate of the value and their price must be within 15 percent of your Bangkok condo for sale’s square footage. Among the factors that are considered in this process include the condo’s closing price, condo improvements and renovations that the owner has undertaken the number of bedrooms and bathrooms, the size of the property, square footage, type of construction materials that were used, and all other important factors.
And since the CMA is highly influenced by the period when similar properties were sold, your condo’s sale value will therefore depend on the recent market trends. Therefore, the CMA must be based on the number of months that these Bangkok condos were on the market before they were purchased in the last 30 to 90 days and the estimated time before your condo is sold at your preferred asking price. Bangkok condos that were once listed in the market but have been cancelled or expired will also help the real estate agent identify which prices are highly inflated.
A qualified Bangkok real estate agent should be also an expert in the local market. That is, he must be highly familiar with the Bangkok real estate market so he can better come up with a more accurate CMA through his local geographic know-how.
And after every piece of information that your real estate agent in Bangkok has prepared, he must discuss the CMA with you and provide a reliable recommendation for the price that you want for your Bangkok condo for sale. In other words, the CMA will justify your offer to any buyer since it is based on factual information to make a convincing justification.
Be careful though if you want to skip hiring a Bangkok real estate agent and opt for an online condo appraiser instead. There are tons of websites that offer their estimate of your condo value through their dubious records of historical condo sales. It’s man versus machine and your Bangkok condo’s value is at stake! There’s no guarantee that the value that these appraisal websites can generate are highly accurate considering that they fail to incorporate the difference in other condos that have just recently been constructed, the amenities in your Bangkok condo building, the recent economic and industry conditions, and other pertinent details. In short, these websites will only produce inaccurate results with a high margin of error.
Don’t be apprehensive when asking a real estate agent in Bangkok to provide you with a CMA. It’s any real estate agent’s forte and for most of these guys, they can quickly crunch the numbers by using their expertise in searching for prices of recently sold comparable units and other Bangkok condo for sale units still in the market to come up with a mean and median price for all comparable units.
Take note too that some Bangkok real estate agents are better at identifying which units to compare your Bangkok condo for sale with. It would be better if you hire someone who has recently sold units in your building since he has ready information on the conditions and recent improvements of the other units.
One way of testing your real estate agent’s competence in preparing a reliable CMA is to ask what price would he recommend if you want to sell your Bangkok condo for sale within 180 days. Also, you might want to consider other issues. Is he going to include the condition of your unit and the recent upgrades that you have spent for? What similar condo units are he going to use? How conservative will he be when incorporating the upgrades in your price?
Finally, remember that your condo’s value is affected by similar units that are also in the market. Imagine if you have a prime unit but there are many foreclosed condo units in the same building. Now, how’s that going to drag down your Bangkok condo for sale’s value? Your unit’s value will also be affected by the financial stability of the condo building association, the maintenance of the entire building, and the security and safety in the area as well.