How do you determine home value?
Spring is around the corner! Now is the time when you may be thinking about selling your home. Your first question probably is…” What is my home worth?” I can’t tell you how many times I have gone to a listing appointment and been told that “such and such website says my home is worth X…”. While it may be true that some of these websites are more accurate than they have been in the past, it is always better to get an opinion of value from a professional that looks at it every day and has their finger on the pulse of the market. Specifically, how do we determine the value of a home?
First, we go to the MLS and look at all the homes that have sold in the neighborhood in the last 6 months. If there aren’t any or the number is low, we look at nearby neighborhoods.
WHAT’S ON THE MARKET NOW
Next, we look at all the homes in the neighborhood that are currently for sale or under contract. We see how long these homes have been active and how long did it take the homes to go under contract. These can be predictors for how quickly a home will sell if priced right.
Thirdly, we select homes that are the most similar to the subject house. Square footage specifically is the main factor. The chosen comparables need to be within 20% of the subject house to be used. Although there may be a house that sold recently that is right next door to yours, unfortunately, I can’t use it if it’s over 20% bigger than yours. Sorry – appraisers won’t use it so I shouldn’t either. In addition, other adjustments are made for bedroom and bathroom count, basements, and garage spaces.
Finally, the best comparable to use in determining value is the one that is the most similar to yours in every way and has sold recently.
Above all, the value of a home can be boiled down to – your home is worth what someone is willing to pay for it.
Ready to take the next step? Contact us for a free no-obligation evaluation of what your home is worth today.
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