MARKET VALUE, APPRAISAL VALUE, AND ASSESSED VALUE
The price at which to list a home is the seller’s decision, although a savvy seller will solicit professional advice or work with a trusted real estate agent to arrive at that decision. Knowing the real estate concepts of “market value,” “appraisal value,” and “assessed value” allows the home seller to more meaningfully engage with a real estate agent in coming to a determination of a home’s listing price. “Assessed value” is the amount local or state government has designated for specific property and frequently differs from market value or appraisal value. This assessed value is used as the basis of property tax and when a property tax is levied. The assessed value of real property isn’t necessarily equal to the property’s market value. Approximately 60% of U.S. properties are assessed higher than their current value; however, this doesn’t reflect what the homes will sell for.
WHAT IS YOUR HOME WORTH?
The first step in selling your home is knowing the difference between value, worth, and price. Let’s examine the determining factors at work. Understanding those factors allows them to be leveraged. There are several ways a home’s value is derived.
ONLINE HOME VALUATION
A place to begin researching a rough estimate of a home’s market value is online. Several free online tools provide an estimate of your home’s current value based on recent comparable home sales in your area, using a comprehensive database. The downside of these systems is that the assessment is based on available public data, with no guarantee of accuracy, and often use an algorithm that simply averages comparable sales in the geographic area.
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