What's the value of a home in Fernie.

The streets of Fernie are still littered with Real Estate signs (197 listings).

I was emailed a link to this website by a cynical friend of mine that hates the fact that I'm a Realtor. It is a spoof Vancouver based Real Estate website.

www.crackshackormansion.com

I laughed out loud while sitting at my desk and occasionally gasped at the sight of some of the photos. When I regained my composure I felt a great sense of relief, knowing that Vancouver Real Estate prices are crazy and was thankful to be working in Fernie. Prices in Fernie obviously offer great value....right??

Maybe the lack of sales aren't because there are no buyers, or that Fernie Alpine Resort won't put any money into the resort or that the Blackstone golf course is stalled again, or that the snow is better in Golden. Perhaps it is that Real Estate prices in Fernie are unrealistic for this economy. Simply put, maybe things aren't selling because prices are too high.

Whenever I would complain to my father, a retired oil salesman, about the price of gas, his comment was that the gas companies set the price at an amount that people are still willing to pay. They will up the price until a point where consumers will start to purchase less fuel, (supply vs. demand).

This system is known as the Subjective Theory of Value (STV). This system of economics is usually termed "marginalist" economics.

The STV states that the price of a commodity is determined by its marginal utility to the consumer and producer. Marginal utility is the point, on an individual’s scale of satisfaction, at which his/her desire for a good is satisfied. Price is the result of individual, subjective evaluations within the marketplace.

No matter how much you want to believe otherwise, what you paid for the house, what it cost to build, what your neighbour paid for their house, nor any other factors have anything to do with what the house is worth today.

My best advice is to get an assessment done by a licenced Realtor and get more than one opinion. Ask your Realtor to show you the comparables, and ask them how they arrived at their price. If a Realtor tells you a price that sounds too good to be true, chances are that it is. A good Realtor will be able to be honest and up-front with you regarding the price. Be careful of a Realtor that won't offer his/her opinion, try and imagine that person at the negotiating table for the sale of your home.

Be realistic in your price and your home will sell quickly, and for more money.

As always, please email any questions or comments.

Thanks for reading.

Ryan
ryan@c21maximum.ca