There are several types of “values” in real estate. Three of the most common values are home market value, the home appraised value, and home assessed value. These three different types of real estate value are commonly confused as being the same thing, which could be a big mistake because they are very different. Market value can be easily described as the price a house would be sold on the open real estate market. If you are trying to price your property, but you are not sure how to do it, take a look at real estate in Laguna Hills Ca to see how your property will compare.
Many factors impact home value and methods that can be used when determining the fair market value of your property
Comparative market analysis
One of the best forms to determine the value of your house is by having a comparative analysis performed on your home. This is a detailed analysis done by a real estate professional that analyzes recently sold homes called “comparables” with the past 6-12 months period in a specified area. Once you have found the right real estate agent in your local area, there are certain things to be on the look out for in their detail comparative market analysis:
- Comparable properties have similar square footage
- Comparable properties have similar baths and bedrooms
- Comparable properties has to be the same style of residence
- Comparable properties need to be located in the same area as your home
- Comparable properties have similar updates and upgrades
It is important that the comparable properties that are used have similar upgrades, conditions, and features, but if they don´t, an adjustment has to be made on the market value of your home.
Another reliable method to determine the market value of your home is to purchase an appraisal on your house. An appraisal is a written estimate of a property value that is completed by an appraiser. There are different types of appraisal methods and can determine a home´s value.
- Cost approach: This is an estimate of what would it cost to reproduce or replace the improvements in your home that will deduct issues such as a deterioration of property. The cost to replace or reproduce is added to the value of the land to complete the appraised value.
- Comparison approach: An appraiser will look for properties that have similar quality, size, and location that have been recently sold. The primary reason for getting an appraisal to determine the market value of your house is because any buyer who is obtaining a mortgage will be required to pay for an appraisal to the lender.
Here are some other important factors to take into consideration when trying to price your house
- Quality of the school district
- Community amenities
- Urban planning and property zoning
- Perception of your neighborhood
- Natural disasters
As you can see, there are several methods and types to determine the market value of your house, and with the appropriate help of a real estate agent, you will find it easier to price your home correctly. This video explains in general how market value works.