I've put this together because we're getting to the end of our window and I know your Mom needs to get this done. When we listed we were dependent upon a very healthy Spring and Summer and unfortunately we didn't see the gains we needed, especially when rates went up.
I understand its tougher not being here so I want to give you as full a picture as possible of the value of your home and the land and the shop, together and separate. The majority of our buyers interested in a home with land also discussed the option of building so I included comparables for land in Ephraim and houses comparable to yours without land.
This comparable shows a piece of land in a situation similar to yours: In town with utilities at the road but work would need to be done to have it ready to divide and build on. This is 14 acres that sold for $85,600. The location of your land would be more desirable except that you have the school and the city lot right next to it.
From my experience if we listed the land and targeted someone looking for 4+ acres, they buy in the county every time because of the tax and they would not like the city lot. If we targeted a developer they'd be concerned that their lots wouldn't sell because of the city lot and would probably be right.
They could do a large privacy fence but its still not a great solution.
From the feedback I've received, I don't think we'd have a buyer for your land unless it was a price developer couldn't go wrong on.
I've used the shop a lot to attract our buyers because its incredibly difficult for a guy to get a shop without buying a house that already has one.
I have been able to show it to many buyers as well as other agents for buyers interested in a shop but the price in relation to some of the work required on the home and landscaping and the location has kept them from writing an offer.
For my latest showing the husband and son were very interested in the shop but when I asked them what the price would have to be for them to buy the house they said $150,000. Thats also the number the city is now verbally presenting us.
The shops value for buyers is coming in around $10,000 to $15,000. Obviously replacement cost of the shop is worth much more than that. Most buyers needing a shop have only needed half the size and also saw things they'd have to spend money on for the shop such as the power to the shop and trying to heat it.
For sold homes, the listing below is a very good comparable: This home is 5 years newer with no repairs needed, has a master bedroom with a master bath, and a fully finished basement giving it almost double the finished space. It sold for $157,000 ($160,000 minus $157,000). As a buyer compared a fully finished basement to our basement, the landscaping they'd need to do, general repairs and our location by the school and city lot, they would come up with a number of at least $20,000 less for our home.
Based on these sales (w/out the shop and land) we'd be pushing the market to get $139,000 (without the shop and land)
Heres our absolute best comparable:
This property is on our st. to the south. Its connected to the new home subdivisions on the bench so that pushes the value up a lot location wise. The had 7.4 acres which is more but doesn't make a big value difference. They had no garage so thats a negative, beautiful landscaping with sprinkler system. 2x the finished sq. footage and it is literally luxurious: 3648 sq. ft 4 bedroom 3 bath.
Take a look at these pictures:
- We are 1590 finished sq. ft. and in need of a complete updating. They've got 2000 sq. ft. on us of finished sq. footage (well over twice what we have and the equivalent of another house) and finished to an extremely expensive standard.
- You're buyer is going to have a lot of work on the lawn and a lot to spend out of pocket on upgrades and repairs. This comparable was completely move in ready with nothing needed to be done.
- Their location is significantly more valuable with Ephraims most expensive homes surrounding it, its up against the bench and is part of the Ephraim Canyon communities. It has a city designated lane already running the length of the property making it easy to divide in the future.
- They don't have a shop or a garage and that is our one advantage over this home.
This house sold for $207,000. So if both of these houses were on the market at the same time, what would someone looking at this comparable house for $207,000 pay for our house?
How much would we have to spend to get our house comparable in finish to this one? At least $60,000 being conservative including finishing the basement and then we'd still be 1000 sq. ft. less house than the comparable.
If we had identical houses on each lot, our 5 acre and the comparables 7.5, what would the difference that someone would pay be from a buyers perspective. Identical houses, yours next to the city lot on 5 and theirs next to the bench on 7.5? You'd end up with at least a $15,000 difference.
$150,000 is the real feedback I've been getting from multiple buyers and when I've pushed to start the offer it comes back to the city lot and the out of pocket expense and labour and they don't do it. By the time their done, even if they did the labour themselves their getting up towards the cost of the comparable above and that doesn't address the city lot at all so no offer.
Our price at the beginning was dependent upon our Spring market being in full blown recovery. There were some signs of it but it didn't happen. It slowed down heavily when rates went up.
These are properties listed but did not sell in our market. The 1st one reflects the value of a piece in town with a lot of land.
This one has a reasonable lot size .79 acres built in 1996, 2700 sq. ft. 2 bedroom 3 bath and is in great shape but didn't sell. 
The homes below are some comparable properties that did sell:
This is a property with a shop and land. An older home that was completely remodeled. 4 bed 2 bath 2744 sq. ft. Sold for $154,230
That is the reality of where we're at. We've got a window still to get it sold right now. We just went through a year of rates at 3.5%. It helped Salt Lake and the Valley and for us it stopped our decline. Unfortunately the rates have now raised. It helped to level our decline in values but didn't give us a big increase in values like we needed.
Right now, we should be seeing a much more significant last push in the market before snow falls and we're not.
Again Russ I want to emphasize that you have a great house. When I'm in your house I can picture a family loving it so much and playing on the property. Our last buyers the sons rode dirt bikes. I can see the Husband with his shop all set up and loving it. I've personally met and showed it to the people that it is a great fit for. We are drastically overpriced for our market.
I want to see you and your Mom and your family get as much as possible for your house, thats why I'm taking the time to create this for you to make the reality of our market clear for you so you can make a decision how to proceed.
You could rent it out for 5 to 8 years and see if we have a strong recovery of the market. You would need to put $5,000 in upgrades first and then do it again when the time came to sell but theres a possibility that the market will be up higher by then and give you a greater value than what the market will give us now.
Let me know what you want to do. My advice is we start doing regular and rapid price drops to beat the end of the market and I advertise that we're dropping the price and create some buzz.
I did have a conversation with Regan telling him my opinion that the city needs to account for the fact that the city lot affects the value of the property and give us a higher offer. He said he had not thought of that and would bring that up with the council. Our problem with the city is they had a need for the house and property before an no longer do.
Let me know how you'd like to proceed. Thanks Russ!
