How to Determine Your Home Value
August 13, 2009
With the current economic times that we find ourselves in, many people, even those who aren’t selling their homes, are at the very least, curious as to what their home is worth. So unless you’re willing to dish out the $300 - $600 on an actual appraisal, you might want to do some of the work yourself. Here are a few tips to follow.
Research the median home value for your area. There is no cookie cutter formula out there that says a three bedroom, two bath home with 2,000 sq ft is worth $300,000. Instead you have to get online and check out local real estate. Go to local open houses to find homes that have similar features such as square footage, bedrooms, bathrooms, basements etc and see what the asking price is. Be sure to view homes that you believe are valued a little above AND below yours.This will give you more comparisons by a specific feature (i.e. pool vs. no pool)
The houses that are on the market have usually had some kind of professional appraisal from an actual Realtor or Appraiser who knows the current market trends and thus most home prices are pretty accurate. Once you have this information, you can begin to assess and compare your own home.
Factors That Determine Home Value
- Square Footage: The more the merrier!
- Bedrooms: Usually having 3-4 bedrooms increases your buying pool. Just don’t sacrifice a garage or dining room to do it.
- Bathrooms: Most buyers prefer anything over one.
- Lot Size: Land will always be in high demand so the more you have the better!
- Location: Homes with a view or in historic locations tend to yield more value, whereas the opposite is true if you’re next to noisy train tracks or a land fill!
- Extras: Crown Molding, basements, pools, updates in kitchens and baths, and new flooring all raise home value and can set your home apart from your neighbor.
- Rule of Thumb: If there are less homes available in your area, the value of your home goes up! Conversely, if you have many comparable homes in your neighborhood, you can actually lose value.
Tools to Help Determine Home Value
There are a ton of online tools to help you find your home’s value, but none are considered 100% accurate. While we recommend consulting a local real estate agent, you can also try the website of your local county appraiser. They usually have great tips and an FAQ section to help answer any questions.
Keep in mind that if you’re planning on buying, selling or accessing equity in your home, you will almost always need a professional appraisal. In this case, look for agents who are licensed and have good references to help avoid headaches down the road.
Know matter how you do it, determining home value is never a sure thing, but by staying on top of your home value and the current market trends, you can be sure to get top dollar amounts when it’s time to cash in!