Valuing a home doesn’t just need to be a gut feeling
Valuing a home doesn’t just need to be a gut feeling. There are a multitude of resources available to real estate agents to help them gauge home value. Here’s how real estate professionals can mine readily available online data to their advantage.
In valuing a home, real estate professionals have a few aspects of the home to consider, but these are the two most primary elements.
- Is your home similar to neighboring properties that have recently sold?
- How much do you value the features of the home, the layout, and amenities?
A good first step is to use the National Association of Home Builder’s “Snapshot of Local HBA Economic and Housing Statistics.” This free online directory can help both real estate agents and homeowners research valuable statistics like population, homeownership rates, home owner vacancy rates, the value of homes owned and the income of homeowners to help you plan and execute your sales plan.
You can also access Zillow’s Zestimate application to browse the prices of homes in your neighborhood. You can compare directly with homes similar to yours, even sorting by things like square feet, amenities, number of bedrooms, and more.
Looking at Comparative Properties
Determining a fair home price is key to being ready to accept an offer. The moment your home goes up for sale you need to be prepared to accept an offer. Setting a range that you’re willing to accept, and ensuring its fair, greatly simplify the process of selling a house. A buyer’s mortgage lender will often hire an appraiser to determine the home price, so estimating your price fairly is necessary. If your estimate is too high, the appraiser will disagree and find the buyer’s loan is not worth the value of the home.
A common strategy is to print the fliers of recent home sales in your area. These can be used as collateral when negotiating. These sales need to have occurred within the last six months, otherwise the comparisons are meaningless due to market fluctuations. In busy markets, like big cities, it is very easy to find comparable property sales. In small towns and rural areas where home sales are rarer, you’ll have to do a lot more searching to find a meaningful comparison.
Critical Elements in Valuation Data Searches on Home Value
The elements most critical to an accurate comparison search are:
- Area or location
- Age of the house
Do you think home values will be data mined more often in the future, or is this just another technology fad? Share your opinion with us in the comment section!
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