But I know What They Paid!

Sometimes in talking with buyers they will comment that they can’t believe how much a seller is asking for a particular house. Often they’ve looked up what a seller paid for a house just a few years ago and think they must be reaching for the stars to ask for so much now. Tax records can be easily located, but they don’t tell the whole story. For example, maybe the previous seller was a family member or friend who was willing to offer a significant discount. Maybe the previous seller was in a financial bind and needed a quick sale. Bottom line is we seldom know the whole story of the circumstances of a previous home purchase and why a home closed at a particular price. We’re also in an era of double-digit yearly appreciation in our market, where time and demand alone are pushing up market prices. Historical prices for a particular home are an interesting data point, but current market comparisons give a far more realistic perspective on where a home should be priced.