Why Is Your House Worth More Than That One?

Real estate markets are a constant tug of war between buyers and sellers. As markets change, so do buyer expectations and negotiating strategies.

One question comes up again and again during negotiations:

"Why is your house worth more than that one?"

If the listing agent can't answer that question clearly and convincingly, the seller may lose the sale—or accept a lower price.

The challenge is that many "comparable"properties aren't as comparable as they appear. Some have material issues that don't show up in the MLS. Others have shortcomings homeowners have learned to live with—but buyers may not.

For example, a home may have radiator heat with no central air, apparent structural concerns, water intrusion, poor-quality renovations, additions that aren't properly heated or cooled, or neighboring properties that negatively affect its value. Any one of these can influence what buyers are willing to pay, yet none of those issues may be visible online in the MLS.

We see this a lot:

"We like the house, but we think you're overpriced by about $25,000."

We have almost always toured that comparable property—and identified issues like the ones above, so we know why it sold for less. That let's us defend our price, and help our clients negotiate from a position of strength.

That's one of the reasons Crystal and I make it a point to tour virtually every one of the roughly 250 homes that come on the market each year in the neighborhoods we serve.

Most buyer's agents work throughout Northern Virginia, where well over 20,000 homes sell each year. It would be impossible for any one agent to see all of them. That's why it's the rare exception when the agent asking, "Why is your house worth more than that one?", has actually toured the comparable property. The bottom line is, they're trying to help their client by supporting the list price if it’s reasonable.

In pricing a home, the noise is treating every comparable sale as equally comparable. The signal is recognizing the differences that truly affect value.