Have you ever wondered how much your home is worth? If you’re hoping to sell, knowing its value is essential for pricing it right to make buyers interested. Or maybe you don’t want to sell your home right now but are just curious whether your Real Estate investment has risen in value.
In either case, having an accurate grasp of your home’s estimated market value can come in handy. Plus, there are a variety of ways to do that. Many of which are free and easily within reach online.
Here’s how to find that magic number, and why having an accurate estimate matters whether you want to sell your home or own it for the long haul.
How to find home value estimates online
One easy starting point is to enter your address into an online home value estimator, which will present you with a free estimate of what your home is worth within seconds, based on data such as square footage and recent home sales in the area.
While this free evaluation will help you get a general idea, remember, it’s just a ballpark figure.
For a more accurate estimate, there’s no substitute for the expertise of a Realtor, who has access to a vast database of information with recent sales to help you home in on that number.
How Real Estate experts determine home values
Real Estate Agents specialize in answering the question “what is my home worth?” for their clients, which they do by running a comparative market analysis. This process involves finding similar properties (comps) that sold within the past 90 days.
The most accurate comp is a home that’s nearby, like yours in square footage, and has the same number of bedrooms and bathrooms. Once your agent finds a few comps, then they average those figures to come up with a baseline of your own home value.
What is my home value to a buyer?
Sellers need to consider how home buyers search for properties online. Let’s assume your home’s fair market value is $503,000. Yet most people search for homes on the web using $20,000 or $25,000 increments.
So, listing your home for $503,000 could prevent your listing from being seen by buyers who are searching for homes in the $475,000 to $500,000 bracket. Therefore, asking $500,000 might generate more traffic and maybe even a bidding war to push that final number well above your expectations.
Also, avoid listing your home at an odd dollar figure. While retailers and as-seen-on-TV purveyors of the Miracle Mop effectively present product prices ending in $0.95 or $0.99, the same does not apply for Real Estate.
Try to remain objective
Sellers always think that their home is worth more than it is, because of their personal attachment.
It is hard to boil down years or decades’ worth of memories in a home to a number. It’s also hard to accept that your home is worth less than what you paid for it, or that you can’t just tack on the full dollar amount of the renovations you’ve made.
On average, renovations will reap you only a 64% return on investment, although that varies based on the type of upgrades you’ve made.
Why it’s important to know how much your house is worth
Estimate your home’s value too high it could wind up sitting on the market. That’s a big problem because a property that goes unsold for an extended period often becomes stigmatized.
Buyers get suspicious when they see a house that’s been on the market for a while. They think something is wrong with the home. If that’s the case, the seller may have to make a significant number reduction.
Pricing your home below market value to stir up interest and generate multiple bids can also backfire. Granted, that strategy could work in a hot seller’s market, but underpricing your home frequently leads buyers to assume that your home is worth only its list price.
Your best bet is to know what your home is worth and list your home close to that figure. When in doubt, turn to our Real Estate Agents to help you cut through the haze and help you pinpoint the right price.