Unless you work in the real estate or mortgage industries, it is likely that you feel confused when you hear certain real estate terms. Every trade has lingo and jargon unique to the industry, and it can take a little bit of time to get used to these things. If you have questions about the lingo in the real estate industry, then the best thing that you can do is ask a few questions, and your real estate agent can explain the situation.
There are three terms that sound similar, but they have different meanings: appraised value, list price, and sale price. It is essential that you understand the differences between these things when you are buying or selling a home:
The list price of a property is the price tag that is set when the home is put on the real estate market. This listing is important because it will set the first impression that people get when they look at your property. Setting a list price that is too high could potentially scare away buyers. At the same time, setting a list price that is too low means that you might be leaving thousands of dollars on the table in real estate equity.
The only way to determine the exact appraised value is to bring in an appraiser to inspect the property. The appraised value is determined based on many different factors. The appraiser will look at the quality of the home, size, lot, finishes location, and more. This appraisal matters especially since it will impact the buyer’s ability to get financing for the property. For example, if the agreed price is higher than the appraised value, then the lender might not approve the mortgage for the buyer.
After the offer has been submitted and the negotiations are complete, the sale price is the final number that will be used for the closing. This sale price can change depending on the negotiations that occur between the buyer and the seller. Different things can impact the sale price, such as the appraisal and inspection that occurs after an offer has been submitted.
Supply and Demand in the Real Estate Market
In the real estate market, as well as other industries, supply and demand matter. If the inventory is low, then the prices will go up. Changes in the economy can have a direct impact on home prices.
It is important that you are working with an experienced real estate team if you want to get the best deal on a home. Whether you are buying a home or selling your current home, you need to have a real estate agent that you can trust.
At DUFFY Realty, we are the top real estate team in Atlanta. Contact us today to learn more about the services that we offer: (678) 318-1700