3 Ways to Calculate Your Home’s Market Value

A crucial part of putting your home on the market is knowing how much you should sell it for. Contrary to popular belief, the price you paid for your home has little to no bearing on its selling price. Your home’s fair market value, or the price a buyer and seller both agree upon, is the product of conditions of the housing market, the economy, and the rate of appreciation (or conversely, depreciation) of the property among others.

Determining your home’s FMV takes research, a couple of tools to help you out, and a few tips to get you on your way. Here are some to consider.

Get a Comparative Market Analysis

A comparative market analysis, or a CMA, will give you deeper insight on your home’s FMV. These include an evaluation of your home vis-à-vis the current state of the market, resulting in the estimated value you can use for listing purposes.

Any local real estate agent should be able to do this for you either for free or for a small cost. However, for this task, you may want to choose an agent you intend to continue working with for your home sale as most expect to be hired after providing a CMA.

Have your Home Professionally Appraised

Over a quarter of U.S. homeowners have their homes appraised and for good reason. On top of providing further insight on the value of your home, getting a professional appraisal of your property serves another purpose. If you’re an average buyer and intend to pull a mortgage for your next home purchase, take note that lenders seek an appraisal before they can approve a mortgage.

Appraisers are there to evaluate your home and produce a value depending on your needs as the property’s owner as in purchases. They evaluate the market, which includes the environment and area that a home is located in; the property, which covers the characteristics of both the house and the land that it’s on; and comparable properties or other sales and listings for similar homes in the same market.

Take a Look at Comparable Properties

While professional appraisers are worth the money, toy can still go DIY when figuring out your home’s value. Among the things you can do without the help of industry specialists is comparing your home to similar properties – something that at least 56% of American homeowners do for themselves.

Both appraisals and automated valuation models (AVM) rely on the value of recent sales of properties that are comparable to yours, known as “comps.” The idea is simply to take a look at comps on the market from there determining how much you can put your home on the market for. Comps are properties that buyers would go for if yours wasn’t listed, including homes that are almost identical to yours in terms of size, condition, and location.

This involves going through websites and paying close attention to the recent sale prices of comps or even just the listing price of these homes. Aim for at least 3 comps to complete and legitimize your analysis.

If you have a home or property you just want to sell as-is right away, sell it Blue Hen Homebuyers. As a home investor, we buy all kinds of homes, regardless of their age or condition. Call our offices today at 910-802-2222 to learn more about how we can help you.

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