The information provided
has the purpose in assisting you in selling your property, and it
reflects both common practices and the experience of Piramide Real
The most important factor
when selling your home is pricing the property right. A home priced
above market value is difficult and may be impossible to sell.
Pricing below market value will help speed the sale if the property
is in good condition. However, it will result in unfulfilled capital
gain for the owner. Special circumstances may justify pricing a
property above or below market value. These are owner determined and
need to be analyzed when considering selling. Occasionally a
property may have been improved beyond its market value. These
properties, even when the improvements are done in excellent taste,
are difficult to sell if priced above the market value for the area.
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The easiest way to get a
ballpark figure on the value of your property is by studying
comparable sales. That is, what has been the recent selling price of
properties similar to yours in your immediate neighborhood. In the
new property market, prices are set by the developer and usually
depend on lot and construction size, and factors such as "view".
However, in the re-sale market, properties tend to reflect the value
of other homes in the area. In this fashion, higher priced
properties tend to increase the value of lower valued homes and
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Sometimes it is difficult
to objectively assess the value of one’s own property. Many real
estate professionals will recommend an appraisal if they are unsure,
or uncomfortable, with the asking price set by the owner. It is
always a good idea to have a professional "market value" appraisal
conducted on your property prior to setting the selling price.
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Very seldom will a buyer
pay asking price for a property. In Puerto Rico a fair amount of
bargaining takes place. Therefore, when setting the price for your
property, consider giving yourself some bargaining space.
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How much are the
improvements you made to your property worth? In general, you can
divide improvements between those that add value to the home, and
those that make the property easier to sell (if aesthetically
Any increase in the total
sq. ft of construction immediately adds value to your home, and this
value is reflected on appraisal. The use to which this new
construction is put to influences the amount ($’s) per sq. ft.
allowed by the appraiser. An increase in living area provides
premium return. Increasing the size of the garage or putting in a
terrace also increases the value, but at a diminished rate.
Converting a terrace into a living area increases the value of the
property, as does converting a garage into a living area. However,
in this latter case, you will be penalized for not having a garage,
unless a "new" garage is built.
Swimming pools, Spas, etc.
For this type of
improvement you may consider a 1 to 1 increase in property value.
That is, if the pool cost was $ 20,000.00, the property value will
increase by a similar amount. Changing carpets for tiled floors is
also in this category, as Puerto Ricans much prefer tiles over
Remodeled kitchen, bathrooms, etc.
An appraiser will
only note the condition of the kitchen, or bathrooms. Those in
excellent condition will be mentioned by the appraiser and given a
fixed value. Investing in gold fixtures or state-of-the-art
appliances, for example, will only cause a modest increase in the
appraisal value, but may make the property more attractive to the
buyer, if done in good taste.
There are three main types
of air conditioning (A/C) from the value added perspective:
In general they do not add
value to the home, but make the property easier to sell.
quieter and more efficient
than window units, they are now seen more frequently in Puerto Rico.
They add from 50 to 75% of their value to their property. That is,
an investment of $ 10,000.00 on split units will add from $ 5,000.00
to $ 7,500.00 to the property, and are a definite plus when selling.
Considered as part of the
price when included by the developer, they do not add to the overall
property value. However, when included as an add-on on properties
not originally equipped with them, they are a definite incentive to
buy and can add up to 200 % their cost to the value of the property.
A caveat: the design must be clean, without protruding lines or
wires, and definitely without water filtrations.
Haphazard or improvements in poor taste
improvements in poor taste will detract from the value of the
property. Therefore, always make sure any improvements are well done
and aesthetically pleasing for the majority of the population.
Improvements for a "specialized taste" will make the property
difficult to sell and may detract from the value of the property.
Among these are painting interior or exterior walls of unusual
colors, and the use of mirrors or wallpaper.
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Anyone in the process of
selling a home needs to be aware of the expenses related to this
transaction. These include:
Payment of existing
mortgages or loans secured by the property.
Real Estate Agent
Commission (usually between 4 and 6% of the final selling price).
Closing costs of the
Other costs not properly
part of closing costs.
Back taxes owed on the
property. Any taxes owed on the property will be retained at
Maintenance fees. If
your property is located in a condominium or development, a
letter stating that all dues are paid is needed. Any dues owed
at the moment of closing will be deducted at the time of
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All your effort in selling
your home is condensed in the few minutes the prospective buyer
spends inspecting the property. Therefore, keeping in mind a few
guidelines will enhance the experience and increase the likelihood
of appealing to the buyer:
Your home should be
"tidy" at the time of showing. It does not need to be
"picture-perfect" but neither should it be as if
If you have abundant
furniture, consider removing some of the pieces, specially of
items that interfere with the free circulation within the
Make sure the property is
well lit and ventilated. Open drapes and turn on lights to make
the property easy to see. If possible, open windows or turn on the
air conditioner to avoid a stuffy feeling.
buyers to feel free to look, and encourage them to open any and
all closets and cabinets for inspection.
If soiled, consider
painting walls and doors, and having the carpets professionally
cleaned. A small investment at this time will help secure a better
price for your property.
Make sure all electrical
and plumbing connections are tidy and in working order. Dangling
wires and leaking faucets are indicative of poor maintenance.
Keep your garden clean
and trimmed. Expensive landscaping is not necessary, but the
property should indicate proper maintenance.
Wall cracks and leaky
roofs should be professionally repaired. Painting over covers the
defects only to cause you legal trouble further on.
Pools, spas and ponds
should be clean and in working order.
Don't be obstructive,
stand inconspicuously so the customers feel free to look around at
Don't chatter. Be available to answer
specific questions but don't carry on.
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