Buying Your Home - Appraisals & Market Value
What is the return on new versus previously owned homes?
into a new-home community may seem riskier than purchasing a house in an
established neighborhood, but any increase in home value depends upon the same
factors: quality of the neighborhood, growth in the local housing market and the
state of the overall economy. One survey by the National Association of
Realtors shows that resale homes do have an edge over new homes. The trade
group's figures show the median price of resale homes increased4.3 percent
between 1999 and 2000, compared to 2.8 percent for new homes in the same
What's a house worth?
A home ultimately is worth what
someone will pay for it. Everything else is an estimate of value. To determine a
property's value, most people turn to either an appraisal or a comparative
market analysis. An appraisal is a certified appraiser's estimate of the value
of a home at a given point in time. Appraisers consider square footage,
construction quality, design, floor plan, neighborhood and availability of
transportation, shopping and schools. Appraisers also take lot size, topography,
view and landscaping into account. Costs of appraisals vary, it is best to ask the cost of the appraisal when it is ordered.
comparative market analysis is a real estate broker's or agent's estimate of a home's market value, based on sales of comparable homes in a community. Most agents will give you a comparative market analysis upon request, usually when your considering selling your home. A CMA is only as good as the comparable sales used to calculate it, be sure your agent has a local knowledge of the local market to ensure the most accurate results.
What standards do appraisers use to estimate
Appraisers use several factors when estimating a home's value,
including the home's size and square footage, the condition of the home and
neighborhood, comparable local sales, any pertinent historical information,
sales performance and indices that forecast future value. For detailed
information on appraisal standards, contact the Appraisal Institute at 200 W. Madison, Suite 1500, Chicago, IL 60606, 7 a.m. - 5 p.m. CT; 888-7JOINAI (754-4624).
I find out the value of my home through the Internet?
You can get some
idea of your home's value by searching the Internet. A number of Web sites and
services crunch the numbers from historic public records of home sales to
produce the statistics. Some services offer an actual estimate of value based on
acceptable software appraisal standards. They also depend on historic home sales
records to calculate the estimate. Neither of these services produce official
appraisals. They also don't factor in market nuances or other issues a certified
appraiser or real estate professional might in assessing the value of your
What is the difference between list price, sales price and
The list price is a seller's advertised price, a figure
that usually is only a rough estimate of what the seller wants to get. Sellers
can price high, low or close to what they hope to get. To judge whether the list
price is a fair one, be sure to consult comparable sales prices in the area.Realtors with local knowledge of the market are a good place to start when pricing. As industry professionals, knowing the price a home is listed for is very different than the price it is SOLD for. The
sales price is the amount of money you as a buyer would pay for a property. The
appraisal value is a certified appraiser's estimate of the worth of a property,
and is based on comparable sales, the condition of the property and numerous
What are the standard ways of finding out how much a
home is worth? 1.CALL YOUR HOMETOWN REALTY AGENT!
A comparative market analysis and an appraisal are the
standard methods for determining a home's value. Your real estate agent will be
happy to provide a comparative market analysis, an informal estimate of value
based on comparable sales in the neighborhood. Be sure you get listing prices of
current homes on the market as well as those that have sold. You also can
research this yourself by checking on recent sales in public records. Be sure
that you are researching properties that are similar in size, construction and
location. This information is not only available at your local recorder's or
assessor's office but also through private companies and on the Internet. An
appraisal, is a certified
appraiser's opinion of the value of a home at any given time. Appraisers review
numerous factors including recent comparable sales, location, square footage and
How do you determine the value of a troubled
Buyers considering a foreclosure property should obtain as much
information as possible from the lender, including the range of bids expected.
It also is important to examine the property. If you are unable to get into a
foreclosure property, check with surrounding neighbors about the property's
condition. It also is possible to do your own cost comparison through
researching comparable properties recorded at local county recorder's and
assessor's offices, or through Internet sites specializing in property
What is the difference between market value and appraised
The appraised value of a house is a certified appraiser's opinion
of the worth of a home at a given point in time. Lenders require appraisals as
part of the loan application process; fees vary. Market
value is what price the house will bring at a given point in time. A comparative
market analysis is an informal estimate of market value, based on sales of
comparable properties, performed by a Realtor or broker. Either an
appraisal or a comparative market analysis is the most accurate way to determine
what your home is worth.