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How Sundae Calculates Your Offer Price

May 29, 2020 | Team Sundae Team Sundae

Selling your house on the Sundae marketplace means choosing the best price from a list of investor offers. This guide explains where your price comes from.

For homeowners who are looking to sell their house as-is, Sundae is a marketplace that will bring multiple cash offers from vetted investors at a single place for free so that homeowners can get the highest price possible for their house.

Unlike the traditional way of selling houses as-is, Sundae is the only marketplace that connects homeowners who are looking to sell their house as-is to the largest network of qualified  investors. Through the marketplace, we enable investors to bid on your house to get you the highest price possible.

Read this guide to understand where your price comes from and how Sundae can get you the highest off-market price possible.

 

In This Guide

  1. Overview of the Sundae Team Members
  2. Step 1: The Initial Valuation
  3. Step 2: The Appointment
  4. Step 3: The Marketplace Agreement
  5. Step 4: Going Live on the Marketplace
  6. Step 5: What Happens Next

 


Overview of the Sundae Team 

Sundae team

If you’re thinking about selling your house to Sundae, you’ll want to get to know the different members of our team and what role they play in the process: 

  1. Customer Advisor (CA) – This is the first team member that a Sundae customer speaks with, usually by phone. The CA’s goal is to provide you with information about the Sundae marketplace and collect basic details about your property. If both parties agree to continue the conversation, the CA will schedule an on-site appointment.
  2. Market Expert (ME) – The Market Expert is an on-the-ground local real estate professional with extensive valuation and construction knowledge. The ME meets with you at your home, tours your house, and comes up with an offer estimate range at the time of the appointment. If you like the offer range, the ME will provide you a “Marketplace Agreement” to place your house in front of Sundae’s network of off-market homebuyers. MEs are happy to provide guidance and discuss other options, as well. Their work involves pre-appointment research, such as reviewing comparable properties and touring your neighborhood.
  3. Sundae HQ Team – Sundae is backed up by a support staff of experienced professionals who help out with activities ranging from valuations analyses, coordinating closing, and managing the creation of a property profile to promote your house on the Sundae marketplace. Our goal is to make everything as simple and convenient as possible for customers, so if something needs to be done in the sales process, this team will handle it. Our extensive experience and access to industry-leading technology ensure a seamless, worry-free off-market sales process. 

Step 1: Initial Valuation

After you submit your information to Sundae, a Customer Advisor will get in contact to collect info, explain a bit more of our process and, if you’re interested in moving forward, schedule an appointment. At this point, we get to work preparing a preliminary estimate of the value of your property derived from the following factors: 

  • Information gathered during call with CA
  • Comparable sales (“comps”)
  • Market trends
  • Construction estimate

comparables illustration

Importance of comps

Once we have the CA’s notes and an appointment on the books, we assign a Market Expert to research your immediate neighborhood, starting with finding comps similar to your house that have recently sold on the market.

For a nearby house to be considered a comp, it must meet three criteria:

1. Same major defining characteristics (i.e. size, floors, rooms, and style)

2. Similar external influences (i.e. location, neighborhood, geographical features)

3. Similar anticipated condition post-rehab

By looking at the closing prices the comps sold for, the Market Expert can get a rough idea of what your house would be worth after updates.

Market trends

Market Experts also research trends in market conditions. These include how quickly houses are selling and the amount they are selling for relative to their listing price. Market trends help determine what the current demand for houses might be. When demand is high, prices tend to be higher. When demand is low, prices are lower. 

Learn more: How to Know if It’s a Seller’s Market

Together, the area’s comps and market conditions help determine the After Repair Value (ARV) of your house. The  ARV is an estimate of what your house may sell for after everything is restored, repaired, updated, cleaned, and made available on the market. 

Construction estimate

Of course, having the ARV is one thing. But Sundae must also estimate what it will cost to do the renovations necessary to get there. As part of creating your initial valuation, our team begins to list what repairs and upgrades may be needed to add optimum value to your house. 

Our team of market experts, project managers, and interior designers have collectively budgeted and managed thousands of home renovation and construction projects. They understand not only construction itself, but the planning and preparation required to complete a job within budget and timeline. This includes considerations like local permitting, availability of materials, disposal regulations, and where to find the right contractors. 

Further reading: Interior Design the Sundae Way 

Step 2: The Appointment

The Sundae ME Appointment

Led by the ME, Sundae prepares the initial valuation estimate in the days leading up to your on-site appointment. During the appointment itself, the Market Expert visits your house and combines all the relevant background data with nuts and bolts observations from the property ground. This step is a critical component of creating a fair and accurate offer estimate.

Sundae’s Market Experts have years of real estate experience and a wealth of knowledge about their local area. This means you can count on them to have insights on what’s in demand in your neighborhood. The ME’s knowledge also helps the Sundae team understand how potential buyers might respond to your house.

The appointment lasts about two hours. During this time, the ME will meet with you face-to-face to discuss your situation and learn more about your property. Here is what you can expect a Market Expert to do at the appointment:

  • Confirm on-file property characteristics
  • Complete a 36-question survey with you, the owner
  • Tour the property and take between 60 and 80 photos

 

By capturing photos of your house’s layout and details of the interior, the Market Expert collects the necessary ingredients used by the rest of the team to make a fair and accurate estimate about what work may be needed on your house. 

Related: Should I Remodel Before Selling?

Aside from gathering information, the other crucial part of the ME’s work is getting to know you, the seller. You and your family’s unique circumstances, needs, and timeline are just as important as the details of your house. Sundae’s goal is not just to ensure you receive a fair offer, but also to provide an experience that delivers on what’s most important to you during this time of transition.

Step 3: The Marketplace Agreement 

After completing all necessary steps in the appointment, the ME will head out to their car and do the work necessary to finalize an estimate and present you with the Marketplace Agreement. If necessary, the ME may get on the phone with the Sundae HQ Team to discuss numbers. This step in the process may take up to 30 minutes. 

During this time, the ME will estimate a Scope of Work (SOW) based on their initial input and the photos and information gathered during the appointment. The SOW will outline repairs, construction, or remodeling needed to bring the house to top-of-market condition. Our goal is to define which projects will add meaningful value to your house, and project accurate cost estimates and timelines for completing those projects.

Learn moreShould I Fix My House or Sell It As Is?

Once the SOW is completed, Sundae has everything necessary to create a solid estimated offer range, including:

  • Learnings from your appointment with the Market Expert
  • Cost of repairs and renovations from the the SOW
  • Your house’s projected ARV

 

Getting the offer estimate range right is very important. For one thing, it helps Sundae set the house up for success on the marketplace by giving investors an accurate starting point to make an offer. More importantly, the estimate range helps you the seller set expectations about where offers for your house are likely to fall.

At this point, the ME presents the estimate range for your consideration. If you decide to move forward, you will need to sign the Marketplace Agreement. This agreement does not obligate you to sell your house to any investor that makes an offer. It simply states that you agree to a home inspection and to make your house available for bid on the marketplace. 

 

Step 4: Going Live on the Marketplace 

Immediately after you sign the agreement, Sundae will set up a home inspection. The home inspection will usually take place one to two days after your in-person appointment. As with any home sales transaction, a licensed professional (not a Sundae employee) will carry out the inspection. Their role is to get a good overall sense of the condition of the home and to uncover any serious issues with the property.

In addition to the home inspection, you’ll need to sign all necessary property disclosures before your house can be advertised on the Sundae marketplace. Many states require home sellers to disclose details about the property they are selling. Disclosures you need to sign depend on state and local laws.

Once the inspection is performed and all necessary disclosures signed, we will advertise your house on the Sundae marketplace. For every house on the marketplace, we create a property profile with all the applicable information and photos from the steps above. At this point, qualified investors have the opportunity to view your profile and make cash offers to buy your house. On average, a house on the Sundae marketplace receives about nine investor offers.

Four days after the home inspection, we will compile all investor offers and prepare to present you with the best of the bunch. In some cases, if you have an urgent need to sell fast, we may be able to pull all the offers together even sooner. Just let your Customer Advisor know that you need to move fast.

See also: What Is a Fair Offer Price When Selling a Home?

 

Step 5: What happens next? 

Now that you have a list of the top offers, all you have to do is sign and let us handle the rest. Once you sign an offer to sell your house on the Sundae marketplace, there are still a few more steps to be aware of. 

Escrow

When a contract is signed, we open an escrow account. Escrow is a licensed third party that helps us complete the sale of the property. Escrow will gather documents from all parties, collect funds, and distribute proceeds. 

Title

We use a third party title company to research the history of the property and discover all liens recorded against it. This group will make requests from the seller if it has any questions while researching. The title company will also record the transfer of the deed with the official county records department when escrow advises it.

Paperwork

After we open an escrow account, the Sundae HQ team will reach out to go over all necessary disclosures from you as the seller. Escrow will also be in touch with any questions they may have for you. When escrow and title are ready, the closing team will provide all paperwork for signatures via a mobile notary. 

Cash Advance

Once your home inspection is complete, you will have the option to receive a $10,000 cash advance from Sundae to help you move or with other expense. Find out more

Closing 

Though we work with many vacant properties, many customers negotiate other arrangements prior to closing. Once you are able to move out we will do a quick walkthrough to confirm vacancy of the property and then close escrow. You have the option to close in as little as 10 days, or take your time and move up to 60 days after accepting our offer.

Also consider:

Selling to Sundae? What to Expect in the Closing Process

How 3 Sundae Customers Evaluated Home Selling Options 

5 Most Popular Ways To Sell Your Home

How to Calculate Net Proceeds From a Home Sale

Interested in selling your house on the Sundae marketplace? Contact us today.

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