OK...once again....if you're asking this question....STOP! Right NOW!!! I am always amazed at the number of buyers who are more concerned about what the Seller paid for a home,  rather than being concerned about the type of value it displays "In the now".

Here's a hypothetical example. The Smiths live at 54 City Drive, and the Jones live at 52 City Drive. Identical houses. Almost identical interiors. The Smiths got a real deal. They only paid $150,000, 4 years ago. The Jones on the other hand paid $165,000. The two properties sold a few months apart. Why the difference in price 4 years ago? Well, the Smiths were able to put in a cash offer, with no conditions...and the Sellers at the time really needed a fast closing. They were willing to take a lot less than the $167,000 asking price. The Jones ended up paying much closer to the asking price and a price much more reflective of the market.

So, now 4 years later, both properties are back on the market and Buyers and Agents alike, reach the wrong conclusion that somehow the Jones house is worth more because they paid more for it 4 years ago. WRONG....they are identical houses and are worth the same amount of money. The Smiths just got a better deal, because they were able to give the Seller what they wanted at the time.

The price that someone paid for the house has ABSOLUTELY NO IMPORTANCE in the market value of the property TODAY!  Say you're looking to buy some IBM stock. Are you concerned with what Mr. Moneybags paid for the stock 4 years ago? No...why? Because you figure he would have paid market value for them. But, what if Mr. Moneybags was lucky enough to pick them up on a day that the market really dived, or perhaps inherited them? Does that mean they should be worth any less or better yet, that he'd be willing to sell them for less today? I doubt it. They are worth Market Value....and if you don't buy them, someone else will. That is the exact same thing with Real Estate. The consumer, today, is the only person that determines Market Value "today".

If you're shopping for a home, do your homework and work with a Realtor that REALLY knows the market you're looking in. Perhaps Cousin Sally from Toronto, may not be the best person to sell you a home in Brantford...but that's another blog! You want to know one thing....what have the homes in the neighborhood sold for over the past 6 months. When you become an Educated Buyer and you're working with a Realtor who knows the neighborhood well, you are in a much better position to get good value, or snap up an under priced listing yourself! So....forget asking...."What did they pay for it.....7 years ago"...and start asking "What have other people been paying in the "immediate" neighborhood within the past 6 months!"