Home Pricing in Southeast Michigan Is About to Change

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Today, I want to talk about the future of home pricing. For
decades, homes have been priced the same way. Realtors look at
comparable homes and run a Comparative Market Analysis.

Part of that is a necessary evil. When I meet with a prospective
seller, I like to focus on absorption rates, what’s coming on
the market, days on market, and other factors. These factors
give sellers a better perspective and insight compared to basic
questions about bedrooms, bathrooms, and price per square
foot.

Home buyers have shifted their focus from bedrooms, baths, and
price to lifestyle, affordability, and commute times. In
recent years, buyers purchase a home to suit their lifestyles.
Right now, companies are creating algorithms to calculate the true
cost of ownership. These algorithms will take factors like the age
of the home, features, and mechanics to figure out the cost of
ownership. 


That’s just one factor these new algorithms will take into account.
A buyer can search for homes based on mortgage insurance, school
quality, and proximity to favorite recreational hangouts. These
pricing models will allow users to manipulate the algorithms by
selecting properties and adjusting for market activity in their
desired area. You can also search for the cost of home
ownership, projected expenses, location, market activity, and the
condition of the property.

For example, let’s say you purchase a home with a new roof that
will last for 30 years and plan on living there for 10 years.
That’s less expensive than buying a home with a 15 year old roof
that’s designed to last for 30 years. You will probably have to
spend more money on roof upkeep. You may even have to replace it,
raising your cost of ownership.

This technology is very new. I’m going to stay on top of it
and direct you to it once it’s working well. I’m very excited about
this new technology. If you have any questions, give me a call or
send me an email. I would be happy to help you!