Do you wonder what your house is really worth? Well, the short answer is simple: whatever anyone’s willing to pay for it. The long answer, on the other hand, depends upon the current market and whether you’re asking an agent, a lender, or a county tax assessor. But why should you have to depend on their word?
You should know ways of determining your property’s value yourself so you’re better prepared to sell or tap into your home’s equity.
Why Knowing How To Calculate Your Home Value Is Important
Knowing the value of your home enables you price it appropriately and, thus, evaluate what you can afford. And the benefits of knowing how to calculate a property’s value extends beyond just purchasing and selling—annual property taxes, home insurance premiums, home equity lines of credit, and refinances are all based on home value, and knowing how to calculate it gives you great control over these processes.
Here are some effective ways of determining the value of your home.
Online Evaluation Tools
Just go online and search “what’s my house worth?” and you’ll be presented with a long list of online home value estimators. The technical term for these tools is AVM (automated valuation model), and they’re generally offered by real estate or lenders websites, such as Redfin and Zillow.
These tools use public records, like tax assessments, deeds of ownerships, and property transfers in combination with some mathematical modeling to provide an estimate of your property’s value based on listing prices and recent sales in the area.
On real most real estate websites, the AVMs are generally there for lead generation and marketing purposes. They’ll provide you a value for just about any property even when data is limited, which makes their accuracy questionable.
Get a CMA
A CMA is a real estate agent’s evaluation of a particular property in a particular market, offering an estimate of value, generally for listing purposes. You can go to any reputable local real estate agency and obtain a CMA for your house for little to no cost. However, you should know that a real estate agency ay provide you one with the hopes of being hired as your selling agent.