Many real estate websites include a lot of information about a property, including its sell history. You can see what the property last sold for and, in some cases, even see all of the previous sales. But to what extent should this information play a part in determining your offer? If you’re selling your home, should you even look at what you paid for it? It some ways, it does depend on when you purchased the home, but overall, past sell prices don’t necessarily have any impact on today’s market.
When Did You Buy?
If you purchased your home years ago or if the house you’re looking at was sold over a decade prier, obviously that price isn’t going to be a good indicator of the value of the property in today’s market. In fact, in some cases, even the price from as little as two years ago may have no bearing on the house’s value. It’s very possible for a house to increase in value by $20,000 in just a year or two. This is especially true in areas that are rapidly developing or that are going through gentrification. Home values in these areas can quickly increase, creating a sense of sticker shock for those who are only going off previous sale prices.
In Virginia, the Market Is Appreciating
While it’s not true in every part of the country, in Virginia, the real estate market is appreciating. On average, home prices are up 4.27% from the previous year. This is because more and more people are buying homes but not as many people are selling. When there are more buyers on the market, sellers can ask for and get higher prices. As long as it’s a seller’s market, prices may continue to increase, further moving the value of the property away from what it once sold for.
Buying an Existing Home Is Still the Better Option
However, even though the market is currently appreciating and home prices are increasing, it’s still more affordable to purchase an existing home than it is to have a new home built. New builds include much more overhead and can have unexpected delays due to weather and other factors. When you’re purchasing a home from the current owner, there are fewer surprises. The inspection may reveal some issues that must be addressed, but these costs are often handled by the seller, not the buyer.
Many Factors Affect Price
There are many factors that affect the price of a property. While looking at previous sell prices can give you an idea of what the seller may want for the property, you can’t rely on that information. The market, the condition of the property, its location, and other factors all impact the asking price. If you’re selling your home, you’ll need to consider all of this information before settling on a listing price. If you’re buying, you’ll need to look at what other homes are selling for and determine what you see as a fair price for the property.
Fortunately, you’re never alone in a real estate transaction. Your agent is there to assist you every step of the way, including helping determine the best price for a property.