Finding The Right Anchor Point…
Unfortunately, the value of your home is not what it was at the peak of the market. Thankfully, it’s not likely to be as low as during the market’s ebb. That’s why it’s important to determine a realistic anchor point, in terms of current home values.
There are two major considerations when determining the appropriate value for your property: market value and appraised value. And they can be quite different, depending on the market cycle we’re experiencing at present.
Think of the market value as the value that a buyer is willing to pay for your home… today. Not last year, not 7 years ago… today.
The most effective way to determine market value is to look through prospective buyers’ eyes. The econ101 principle of supply and demand comes into play. Positioning your home properly among competing inventory is a critical step. To that end, I’ll carefully take the time necessary to study current market conditions in your home’s neighborhood *and* price range. Then I’ll objectively analyze the features of your home compared to the other homes, further refining the valuation. It’s important to approach this homework very methodically, to establish homes values.
I also watch for the ‘market echo’ in response to valuation and pricing. Are brokers showing the home? Are buyers submitting offers? How quickly you (or your neighbor) may wish to sell is an additional factor that can greatly influence market value in the short term.
Aside from market value, there is the appraised value of a home. It’s important to realize that approximately 92% of all homes are sold to buyers who get a mortgage. That means the sale of your property is likely to be subject to an appraisal for supporting the sales price. And appraisers approach value quite differently than market value. They only look at recently sold homes, and limit their search to the three most similar properties, within the neighborhood, that have typically sold in the past 6 months. To that end, of keen importance to an appraiser are the updates and upgrades in your home, and the overall condition of your property
Curious about how much your home may be worth today? Contact me, I can help you!
Tammy Thrift, Realtor
Serving Your Real Estate Needs, From Colonial Williamsburg To The Chesapeake Bay!
Actively licensed with Long & Foster in the Commonwealth of Virginia (USA)