Posted Tuesday, October 28, 2014
When you are pondering the value of your home, you may want to evaluate your property from a few different angles to get a good feel for its worth.
- Value: As the credit card commercials imply, the cost of something isn’t necessarily the same as its value (which can be “priceless”). Value takes into account how individual buyers might use a property. For instance, the home being in a good school district is probably more valuable to a family with children than to a bachelor. On the other hand, accessibility to nightlife is most likely more valuable to the bachelor than to a family with children. You may value the wide lush lawn of your home while other people see that asset as a detriment, because that lawn always needs mowing.
- Cost: The cost of the house for the sellers is the price paid for the home plus improvements made during their tenure. Remember, the sellers’ cost is unlikely to be the same as the fair market value. Not all changes to a home necessarily add to its fair market value; in fact, quirky renovations can make properties more difficult to sell.
- Fair market value: The fair market value of a property is determined, in part, by looking at similar properties sold in the area in the last six months. This Comparative Market Analysis (CMA) considers items such as number of bedrooms and baths and the neighborhood in which it’s located. A basic CMA may not factor in everything that goes into setting a price for the property. For example, if your home is in significantly better condition than comparable properties or has a spectacular view, those factors will most likely increase your home’s fair market value.
If you’d like a Comparative Market Analysis for your home, including all the special factors that set your home apart from other homes in your neighborhood, give me a call or email me today.