Although you may not be thinking of moving any time soon, chances are you are still curious about the value of your home. Most homeowners reflect on how much their home is worth, particularly when they see noticeable changes in their housing market. If you’re wondering about how much your home is worth, here are some of the best indicators that can help you calculate an approximate price range.
How Much is My Home Worth?
In order to find out how much your home is worth, real estate agents will pull together a comparative market analysis. This essentially means looking at homes that have sold recently in your area, and honing in on homes that are similar to yours (ex: the same number of bedrooms, similar square footage, and so on). Once they have found several homes that are comparable to yours, they will be able to create an average price point.
This is a process that you can carry out yourself, but remember that if you are actually thinking of SELLING your home, pricing it perfectly will be incredibly important! As a serious seller, it will be up to you to rely on the knowledge and expertise of a good real estate agent.
What Competition is There?
Simply looking at how much homes have been SELLING for will not give you the most accurate estimate of how much your home will sell for in the current market. One big factor to take into consideration is which houses are currently on the market in your area, and how much they are listed for. Again, the houses that will be the most relevant to your particular price point will be the ones that are comparable in terms of size, number of bedrooms, features, and so on.
Even if your neighbour sold their house for $525,000 4 months ago, and your home is almost identical, that does not mean that you can expect your house to sell for the same! Market conditions will be very important in terms of choosing the correct listing price, and if another neighbour currently has their home listed at $450,000, buyers won’t look twice at your home if it is priced significantly higher.
Sometimes, knowing when to list can be just as important as knowing what price to list at. Having an experience realtor who can advise you about market conditions and help you make these decisions is always a good choice.
Avoid Odd Figures
After doing all of your research, you may decide that your home is worth $503,000 at fair market value. But, before you start planning your next renovation or deciding to put your home on the market, take a step backward. According to realtor.com, most buyers look for homes in $20,000 or $25,000 increments.
Remember that buyers (and their realtors) can filter listings by looking at, say, the $475,000-$500,000 range. That means that simply by pricing your home at $503,000 instead of $500,000, you’re missing out on a huge pool of prospective buyers! Keep in mind that your listing price may not necessarily be the final price. Often, making these kinds of small adjustments will be in your best interests.
Try to Be Objective
You will have an emotional attachment to your house that potential buyers will not. Remember to leave your personal feelings of attachment for your home out of the equation. It is very common for homeowners to believe that their home is worth more than it actually is: pay attention to the facts of the market, enlist the help of an experienced real estate agent, and remember that buyers aren’t purchasing the memories you have made.
Ask yourself: what is my home worth to a buyer? What are some of the best features of my home? What are a few drawbacks that may make buyers hesitant to put in an offer? Remember to be honest and objective with yourself.
The Bottom Line
At the end of the day, knowing how much your home is worth will be a vital part of your SELLING strategy. Having an idea about what the value of your home can also help to satisfy your curiosity and keep you informed, even if you have no immediate plans to sell your house. Keeping an eye on the real estate market will help you gain a general sense of how much your home is worth- however, for the most accurate pricing, it is best to work with an experienced real estate agent!