How to Determine the Value of Your Property

Mortgages depend significantly on the value of the property that is involved. Consequently, it becomes important to know how much a property is worth before heading into refinancing plans, looking for a home loan, or selling a house.     house value on my street

One way to do this is to determine the market value of the property. A simple way to do this is to look at other comparable homes in the same neighborhood and see what prices they have been sold recently. The Internet or real estate agents are effective and efficient resources for this purpose, and will most likely come at no cost to you.

Another way to find the value of your property is to find its appraised value. To do this you need to pay for the help of a trained and licensed professional. They will take into account a variety of factors, including the home’s square footage, construction quality, floor plan, design, surrounding neighborhood, proximity to important services and locations, as well as the landscaping, among other factors. An appraiser will usually cost anywhere between $200 and $300.

An appraiser can also tell you the replacement value of the property. This is how much an appraiser estimates it will cost to build a similar house on an unoccupied lot. The appraiser will take the age of the home into account to make a better estimate with deterioration and depreciation in mind.

One important thing to note is that a home’s estimated value is not the same as its worth. A home’s estimated value is defined by one of the methods listed above, while its worth is eventually established by what potential buyers are willing to pay for it.         real estate value

First, find at least three similar homes in the same area that have sold within the last year, and preferably within the last six months. You can find this information is in county records (sometimes online now), or from a real estate agent with access to the multiple listing service. Make sure you have the basic sales information: sales price, terms of sale, description of the property, etc.

Here is how you use this information to find real estate value. Write down the selling price of your first comparable. Review the description item by item, adding to the sales price of the comparable for each thing it doesn’t have that your subject home has, and subtracting for each thing it has that your subject home doesn’t have.

This sounds confusing, but it will make sense once you try it a couple of times. For example, if your subject home has a second bathroom, and the comparable doesn’t, you add the value of the bathroom to the sales price of the comparable. If a comparable home has a blacktop driveway, and the subject home doesn’t, you take the value away.   House Value Calculator

What you are doing is rectifying differences, to see what the comparable home WOULD have sold for if it was just like yours. Suppose a comparable sold for $140,000, with one less bathroom than your subject home, and a bathroom is worth $15,000 in your area (ask a real estate agent for help with these figures). You ADD $15,000 for the bathroom it doesn’t have. You subtract, say $4,000, for the paved driveway it does have, that your home doesn’t have. $140,000 plus $15,000, minus $4,000 gives you a comparable sales price of $151,000.

Do this with all the differences between the subject home and each comparable. Once done, average the three comparable prices. If, for example, the three comparables now have adjusted sales prices of $151,000, 162,000, and 149,000, add the three figures and divide by three. The indicated value of the home is $154,000.

All appraisal is an inexact science. You might only find comparables sold over a year ago, and have to estimate appreciation in the area. If a comparable sold with seller financing, you have to decide how much this affected the price. Still, for all of its flaws, for single-family homes, this is the most accurate method for finding true real estate value.

Go to After completing You will receive Your Comps to Use to Value Your Home.