Shopping for a 3 bedroom home in Urbandale under $125,000 that does not need updates or any work on it can be a very frustrating ordeal especially for someone that has gone to the effort to save for a down payment and get pre-qualified to buy a home in that price range. My heart goes out to their ordeal.
With the cost of new home construction in Polk County in the $150 per sq ft range and as land prices continually increasing, the value of pre-owned homes continue to rise as well.
When I look at prices of homes in other areas, central Iowa residential homes continue to be below much of the rest of the United States.
It’s really not “Who” sets the Asking List Price of Homes For Sale in Urbandale… it’s more a “What” sets the price. Many people think that real estate agents set the listed home prices. However list prices are determined by Sold Comps…at least they are in my office. A Market Analysis is done that looks at properties that have sold that are as near in proximity and as similar to the subject property as can be found. The same comps that are looked at would be the ones used during the appraisal process.
When a homes is financed, the lender will order an appraisal. Financing Contingencies usually require that a home appraise for at least the sale price of the home or the Buyer can either pay the difference between appraisal and sale price, or they can cancel their contract. A home appraisal coming in below sale price is still uncommon because we use a similar process at listing time as the one that an appraiser would use during contract time. Many sellers get an appraisal by a certified appraiser prior to listing.
That said – Home Sales usually set the price for new listings.
Urbandale has many landlord investors who are continually and aggressively looking for homes as well. That makes it an even more competitive market and that in and of itself drives the price of these homes up. That also decreases the number of homes available in that particular price range.
As a Realtor, it is not my job to set market value. The market itself sets the price of homes. What home buyers are willing to pay for a home certainly factors into that market value for that immediate area. Location and condition are the two major determinants for comparing properties in an analysis.
The fact that the cost of living here is lower than a lot of places. That is also a factor that can increase the cost of homes instead of being a factor to lower the price of homes. More and more, people want to live here, work here and retire here. The city’s desirability as a place to raise a family is why its so hard to find homes at lower price points.