Wonder what your house — or a house you might buy — is really worth?
The short answer’s easy: A house is worth whatever someone will pay for it. The long answer depends on the market and whether you’re asking a lender, an agent or a county tax assessor. But why take their word for it?
Knowing how to calculate your home’s value with the help of online tools and trained professionals better prepares you to buy, sell, refinance, tap into your home’s equity or even negotiate lower property taxes.
Get a comparative market analysis
When you’re ready to dive deeper into your home value, you can ask a local real estate agent for a comparative market analysis, or CMA.
Though not as detailed as a professional appraisal, a CMA provides an agent’s evaluation of the home and market to provide an estimate of value, typically for listing purposes.
-
- Are you ready? Here is what I will send you: Your Neighborhood Report (Recent Sales, Demographics and More), A detail marketing report showing how we showcase your home, a CMA(Comparative Market Analysis) showing you the best price to sell your home.
So...You can text me at 352-989-3336 (Just say I want to know what my home is worth)
Complete this form, and have it emailed to you. (Typically takes 2-3 days, and be sure to check junk and spam)
Or email me direct at vsmith@areaproflrealty.com
Hire a professional appraiser
Lenders require a home appraisal before they’ll approve a mortgage, but as a property owner, you can hire an appraiser to estimate home value at any time. More than one-fourth (28%) of U.S. homeowners determined their home’s value through an appraisal, according to the survey.
“As an appraiser, my job is to give a value based on the needs of my clients,” says Ryan Lundquist, owner of an appraisal company based in Carmichael, California. “Sometimes clients want the value for a date in the past, and other times it’s a current market value for a refinance or purchase.”
Among other things, appraisers evaluate:
-
Market: The region, city and neighborhood in which a home is located.
-
Property: Characteristics of the house, including improvements and the land it sits on.
-
Comparable properties: Sales, listings, vacancies, cost, depreciation and other factors for similar houses in the same market.
This information is combined to create a final opinion of value for the home and delivered in an official report.
***NOTE: once you have your appraisal, finding the right agent helps sell it at that price. Hire a professional gives you the best exposure.
Evaluate comparable properties yourself
One thing appraisals and AVMs have in common is their reliance on the recent sale value of comparable properties, often called “comps.” Well over half (56%) of U.S. homeowners estimated their home’s value by looking at comparable properties. On its face, this approach seems simplest.
Pulling comps is one way to determine market value without paying an appraiser or asking a realtor, but use good judgment. “Just because the property next door sold doesn’t mean it’s a comp,”.
To choose accurate comps, you must employ an “apples to apples” approach.. Think about which properties would interest a buyer if yours weren't available. Look for similar size, location, condition and upgrades.
To get started:
-
Browse a site where MLS listings are displayed, to find the recent sale prices of comparable houses in your neighborhood.
-
If there aren’t enough recent sales, look at listing prices, but remember they might not be realistic.
-
You’ll need at least three valid comps to come up with a likely range of market value for your house.
Once you’ve chosen comparable properties, things get a little tricky. You’ll need to adjust for differences between your house and the comps, such as adding value to the comp price if it has more bedrooms than your house or subtracting value if its interior is outdated, for example. How much you add or subtract depends on conditions in your market, which can vary widely. After adjusting values, look at your highest and lowest comps. A rough estimate of your home value is somewhere in the middle.
Keep in mind that, in a rapidly rising or declining market, home price information can become outdated quickly — and data from home sales a few months ago might not be a very helpful comp. Again, a local real estate professional will have more current information.
Why home value is important
Knowing your home’s value allows you to evaluate what you can afford, determine whether a listing is priced appropriately and decide how to price your own home, says Gayle Weiswasser, senior vice president of marketing and communications at Homesnap, an app that offers home value estimates.
And the benefits of finding a home’s value don’t end with a purchase or sale: Refinances, home equity lines of credit, insurance premiums and annual property taxes are all based on home value.
Determining your home’s value means greater control over these processes. Property taxes are almost always open to appeal, for example. If you can prove an assessment is too high by pulling comps, you may be rewarded with a lower tax bill.