A broker's price opinion, or BPO, estimates a home's selling price.
A broker's price opinion, or BPO, is used to calculate the selling price of a home. Unlike an appraisal, the BPO is an estimate of a home's selling price, rather than the actual value of the property. A BPO request is generally made by a bank seeking to understand the selling price of a home if it were to be repossessed and fail to sell at a foreclosure auction. The opinion is calculated by examining the home's condition, repair costs, attractiveness of the neighborhood, comparable listings and comparable recent sales.
Instructions
1. Estimate the repairs needed to restore the property to an undamaged condition. Include costs for painting, carpet replacement, appliances, trash removal and restoration, including restoring utilities function. Tally the costs.
2. Determine the overall selling state of the property. Identify any titling or legal issues that must be addressed. Identify any environmental conditions that might affect the sale of the home.
3. Evaluate the neighborhood. Determine if the residences in the neighborhood are primarily owner-occupied or tenants. Identify whether the selling prices of neighborhood homes are stable, on the rise or in decline. Identify the number of active listings in the neighborhood and the range of prices.
4. Study comparable listings, including prices and any deviations from the property being examined for BPO. Include differences such as the number of rooms, square footage, lot size, garage space and amenities.
5. List the recent sales prices of comparable properties. The office of your county assessor will have recent home sales on file. List the properties along with any differences from the property being evaluated.
6. Estimate the property's selling price based on comparisons to prior sales, existing listings, neighborhood status and your professional opinion. List your opinion of both the sale of the house in the current state and the sale of the house with repairs made.
Tags: selling price, broker price, broker price opinion, comparable listings, from property, from property being, home selling
