Stats are a common tool used to help you with the purchase of an Edmonton home. They can help you understand the real estate market better. However, they can also inadvertently hurt you, especially if you plan to purchase a luxury property.
You can certainly use statistics to get a good idea of the average price in a specific community. They can also be used to help get a more accurate look at the actual community and to negotiate a better price. However, they can also be used in the wrong way. Here are some of the most common ways stats can trip you up.
Instead of using averages, using single sales can really trip you up. Whenever possible, you want to use the average of at least 10 sales in the neighbourhood or zone. This makes it easier to get a real statistic instead of just one example.
You may hear this term, as it's very common, but they don't really exist. These stats come from stories that simply are not true or fact. Make sure you don't use these types of stats at all.
Making Statistics Your Number One Factor
Your most important factors for buying a home should never be stats. Instead, you need to choose something that fits you. Real estate isn't just an investment, but it also offers security and a place for you to actually live. This means you cannot just make this decision based on the stats.
How Do Real Estate Agents Draft a Price For a Home?
Your real estate agent is going to look for comparable homes in the area that have recently sold. The number of bedrooms you have, the size of your lot, and the square footage will all be taken into consideration when drafting a price for your home. In addition, your real estate agent is going to look to see if your home needs any major repairs, or has cosmetic problems that need to be addressed. Your agent will look at the homes that are on the market right now and look at how quickly you are trying to sell your home. If you need to sell your home fast, your home will be priced at an amount that is a bit lower than other comparable properties in the area. If you can wait awhile until your home sells, your home may be priced a bit higher to see if anyone makes a bid at the higher price.
Comparing Apples and Oranges
If you compare homes that are not the same, you will not have good stats to work with. You need to either make adjustments for the differences or find better comparable homes. For example, if you compare a home 20% smaller to another one, you cannot simply look at the sale price anymore.
These are just few of the ways stats can lead you in the wrong direction with real estate. As great as statistics can be, they need to be used in the best way possible.
By Justin Havre