A House Appraisal: Find the Value of a Home
How do people find the value of a home? Meaning, what a home (usually their home) is worth?
Of the most common ways to find the value of a home, a formal house appraisal is the most accurate.
If you REALLY want to know what a property is worth, you need to know why most (cheap and easy) ways to find a home value aren’t accurate. If the value you find for a property isn’t right, then what good is that?
Ways to Find Home Value
On-line (Internet) “instant” home values websites
These are probably the worst way to find the home values – they rely on incomplete information, and the data is often out of date. Yeah – they’re fast but what good is fast if it’s wrong?
What a neighbor’s house sold for last year
Another unreliable source of information – unless the neighbor’s house is exactly like yours and the sales price has been confirmed by someone with access to the real numbers for the sale. Even then, the market TODAY might not be what it was when the neighbor’s house sold and we all know that timing matters a lot in real estate.
The tax records
Although these should be a good source of home values information, tax records are frequently wrong since the tax district doesn’t usually know about updates or renovations to a home unless the updates required a permit. Tax records also don’t show that the homes sales prices in an area are going up or going down. Tax values also rely on huge databases of information that may not be up to date.
A local real estate agent
An experienced real estate agent can give you information about other homes that have sold in your area, which can give you an idea of what your home might sell for if you are planning to sell it.
Unless you really are planning to sell, though, and are looking for an agent to list your home, a local agent might not want to spend the several hours that it takes to pull the best sales data for homes like yours that sold in the last few months.
A house appraisal
Otherwise known as a real estate appraisal, a house appraisal is the formal way to find the value of a home. Real estate appraisers have to have formal training, pass difficult exams and use very well-defined ways (approaches to value) to figure out the actual, current market value of a home. Read the article Appraisal Steps: Determining Market Value of Property to understand what an appraiser does to figure of the value of a property.
Which Way Will Work For You?
Sometimes, you just want an idea of what the value of a home is. In that case, check out the on-line home value sites. Or, check out the tax records just for fun.
If you’re planning to sell your home, call a local real estate agent who knows your area well.
If your home is unusual (really big, really small, on a huge lot, heavily upgraded . . .) or you want the most accurate market value opinion for your home, you should bite the bullet and call a local real estate appraiser to do the job.
Bryan McDonald says
I love it, “If the value you find for a property isn’t right, then what good is that?” Great blog post Alison.