There are many factors which must be considered when determining a home's value.
Many online resources claim to provide an accurate price range for a home based on its physical characteristics and location. But prices vary significantly, even within small neighborhoods, so these tools are often not very useful. A little knowledge and expert advice can help homeowners put together an accurate and inexpensive estimate on their own.
According to HGTV's FrontDoor, one of the most common ways to price a home is to calculate the price per square foot, then measure the area of the home. The price per square foot is reached by taking the value of a comparable home that recently sold in the same area and dividing that value by the home’s square footage. The process of measuring one's own home is somewhat labor-intensive, however, and doesn’t account for pricing home fixtures and other features. For these and other reasons, it might help to consult an expert.
The most valuable resources are real estate agents, who are willing to provide estimates, sometimes for free, on how much they think your home would sell for on the current market. These agents will visit your home and record such measurements as room size, room number, various appliances, luxuries and quality of construction. Other significant mitigating factors in pricing a home include the current popularity of your home’s style, as well as its location, which covers neighborhood safety and the overall quality of life in the area. They’ll set this data against recent sales figures in the area to come up with a reasonable sales price. The Federal Trade Commission (FTC) offers tips on selecting a real estate professional.
By consulting a number of different agents, homeowners can average their evaluations to get a more accurate figure. One helpful question to ask agents is how supply in the neighborhood compares to demand: If many houses are available but fewer buyers are interested, ask how to price the home to counter the trends. To supplement the work of the real estate agents, consult real estate listings to see how much homes similar to yours have sold for in your area. Look at homes within a half mile of your own to make accurate comparisons, and try to single out homes on the same side of dividing lines, such as streets or bodies of water, as your own. By the same token, check out listings that have been withdrawn or expired, and look for patterns, such as common agencies or pricing issues, that might provide hints as to why they didn’t sell.
Many communities employ assessors to come up with a market value, which can have a big influence on the value for which you can sell your house. Assessors look at many of the same factors real estate agents do when making evaluations. If you’re unsatisfied with the assessor’s estimate of your home’s value, refer to the assessor’s office to find out how an assessment review is conducted. If the review takes place and you still aren’t satisfied, there are higher levels of review you can request, and your assessor is obligated to inform you of them if asked.