My neighbor’s house sold for a crazy high price a couple of years ago. Does this mean I can price mine above?

In Sellers, FAQ's by Doug Phelps

For nearly a decade, the Denver metro real estate market has been a wild ride of record-setting activity. This year with COVID-19, this is even more true. We are here to help you prepare for what’s ahead.

Since March, home is probably something you have spent a lot of time in and thinking about. Maybe your dreaming of more space. Perhaps the thoughts are about downsizing. Or life has simply shifted priorities.

Maybe you are thinking about selling or buying.

If you are, it’s rather impossible to completely predict what is next in the next few months of 2020. Or even 2021 and beyond. This much we know — for years sellers have been in charge thanks to extremely low inventories of available homes. This forced buyers to compete against multiple offers at almost every price point.

As you think about what your future holds, what questions should you be asking? This blog series will explore several questions from both the seller and buyer points of view.

Seller Question:

My neighbor’s house sold for a crazy high price a couple of years ago. Does this mean I can price mine above?

Answer from Doug:

Pricing your home is both science and art. It can be tricky. Assuming a buyer of your home uses a lender, lenders hire independent appraisers to verify the market value. Appraisers gather details and sold prices of the most similar nearby home sales to estimate the value of your home in the current market. Appraisers typically can only gather data on home sales in a maximum of the last six months. any sales beyond the last 180 days are irrelevant. Therefore, the neighbor’s house sale two years ago isn’t applicable.