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February 5, 2024

Don’t Depend on List Price To Guide Your Home Search

Central Sunset House

The secret to a successful home search is simple: Know what you can afford.

Here’s an example of what can happen if you ignore that reality: You’re preapproved for up to $1.2M and you really want a house in the west part of town—think Sunset or Richmond. Suddenly, you spot a three-bedroom home that’s totally remodeled and has a nicely finished bonus space down, and it’s listed for $1.1M! You’re not familiar with the selling patterns in these neighborhoods and you move ahead to write an offer, submitting one at your max price. Later, your agent calls to tell you that the seller received 13 offers and the house is in contract for well over $1.5M.

And so it goes.

To avoid that inauspicious beginning, get your Realtor on board early in the process so he or she can give you an idea as to what you can realistically afford—and help you decipher relevant selling patterns.

It’s important to break down this type of data into neighborhood-specific sales. For example, the two-bedroom house with parking in Bernal Heights will most likely have a different value than the one in the Central Sunset.

Bottom line? Don’t get sucked in by teaser list prices. In the end, it’s possible to buy a suitable home without having to write 25 offers to achieve your goal.

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