We all want to be good neighbors. But when it comes to selling your home, it’s not just about “keeping up with the Joneses.” It’s about outshining them at every opportunity!
Read MoreTop 6 Home Organization Upgrades that “Spark Joy” for Buyers
Thanks to Marie Kondo and her hit Netflix series “Tidying Up,” home organization is a hot topic right now. Marie encourages her viewers to minimize their possessions and keep only those items that “spark joy.”
With spring in full bloom, now is the perfect time to do some spring cleaning and add organizational systems to your own home. Not only will you clear out clutter, your efforts can actually increase the value of your home.
Read MoreHow to Amp Up The Resale Value of Your Home
Whether you're putting your home on the market this year or in the next five years, it is a smart decision to start building your home's resale value now. Here are some ways to create a comfortable home while making it easier to put more money into your bank account on closing day.
Read MoreIncrease Your Home’s Value Up to 28% with These 5 Tips
Great curb appeal not only makes your home the star of the neighborhood, it can also improve its value and help you sell it for more. Whether you’re thinking of listing your home or just want to make your home the envy of your neighbors, here are several ways to increase your home’s curb appeal.
Read MoreThe Compound Effect: Building Your Household’s Wealth
Wealth is within reach for many people; however, according to a recent study,63 percent of Americans said it’s not likely they’ll become rich.1While younger people are more likely to say they’ll achieve wealth one day, only 34 percent of people aged 30 to 49 and 21 percent of people aged 50 or older say the same. There is no secret to becoming rich: it takes time, sacrifice and good financial sense. Here are a few ways to build your household’s wealth.
Read MoreWhat's Your Home Actually Worth? Discover What Buyers Will Pay in Today’s Market
It’s easy to look up how much money you have in your savings account or the real-time value of your stock investments. But determining the dollar value of a home is trickier.
As a seller, knowing your home’s worth helps you price it correctly when you put it up for sale. If you price it too high, it may sit on the market. But price it too low and you may be losing out on a good chunk of money (nobody wants that!). For buyers, it’s important to know a home’s worth before you make an offer. You want your offer to be competitive, but you don’t want to overpay for the property.
Even if you’re not a buyer or seller right now, as a current homeowner you might just be curious about the value of your home. Keeping track of your home’s worth year over year helps you understand the trends in your market. So when you are ready to sell, you can take advantage of a good window of opportunity.
The good news is, a trained real estate agent—who understands the nuances of your particular neighborhood—can determine the true market value of your property … and at no cost to you!
THE THREE TYPES OF HOME VALUES
When you start the process of buying or selling a home, you’ll frequently hear the words appraised value, assessed value, and true market value. It’s important to know the difference between each one so you can make better, informed decisions.
Appraised Value
A professional appraiser is in charge of determining the appraised value of a home. These appraisals are typically required by a lender when a buyer is financing the property. And while the lender is the one requiring this information, the appraiser does not work for the lender.1Your appraiser should be an objective, licensed professional who doesn’t have allegiance to the buyer, seller, or lender—no matter who is paying their fee.
The number the appraiser comes up with (the appraised value) assures the lender that the buyer is not overpaying for the property. For example, imagine a seller lists a home for $400,000. They reach a deal with the buyer to sell the home for $375,000. However, if an appraiser evaluates the property and determines that the appraised value is actually $325,000, then the lender will not lend for an amount higher than that appraised value of $325,000.2
When figuring out this number, an appraiser will compare the property to similar homes in your neighborhood, and they’ll evaluate factors such as location, square footage, appliances, upgrades, improvements, and the interior and exterior of the home.
Assessed Value
The assessed value of a home is determined by your local municipal property assessor. This value matters when your county calculates property taxes each year. The lower your assessed value, the less property tax you’ll pay.3
To come up with this value, your assessor will evaluate what comparable homes in the neighborhood have sold for, the size of your home, age, overall condition, and any improvements or upgrades that have been made. However, most assessors don’t have full access to your home, so their information is limited.
Assessments are done annually to determine how much property tax you owe. Many counties use a multiplier (typically between 60%-80%) to calculate the final assessed value. So, if the assessor determines that the value of the home is $300,000, but the county uses a 70% multiplier, the assessed value of the home would be $210,000 for tax purposes.4
If your assessed value isn’t as high as you envisioned, don’t sweat it. Many homeowners appeal their assessment in favor of a lower valuation so that they can save money on property taxes. If you’re interested in appealing your property tax assessment, let us know. We offer complimentary assistance and would be happy to help you build your case.
True Market Value
True market value is established by your real estate agent. It basically refers to the value that a buyer is willing to pay for the property. A good real estate agent is an expert in determining true market value because they have hands-on experience buying and selling properties. They understand the mindsets of buyers in your market and know what they’ll pay for a desirable house, townhouse, or condo.
As a seller, knowing your true market value is important because it helps you choose how much to list your property for. It can also help you decide if you want to make any improvements to your home before putting it on the market. Your agent can help you figure out which updates and upgrades will have the biggest impact on your true market value.
WHAT’S THE DEAL WITH ONLINE CALCULATORS?
When figuring out your home’s value, you might be tempted to see what popular real estate sites like Zillow, Redfin, and Trulia have to say. When you use an online calculator to determine your home’s value on these sites, it is just an estimate. It’s not an actual appraisal or the “true market value.” These sites all have their own algorithms for coming up with their estimates. For example, Zillow comes up with their “Zestimates” by calculating “public and user-submitted data, taking into account special features, location, and market conditions.” 5
These online estimates can be a great starting point for opening up the conversation with your real estate agent about your home’s worth. But even Zillow recommends that you use a real estate agent for coming up with the actual market value of your home. The site says that once you get your “Zestimate,” you should still get “a comparative market analysis from a real estate agent.”
Having an agent involved in this process is essential because they understand the market better than a computer ever could. They’re showing property in your city every single day, and they know the particular preferences of buyers and sellers in the area. Young professionals, large families, empty nesters, and other groups are all looking for different things in a home. A local agent has most likely worked with all of them, so they understand what every segment in your market is specifically looking for.
HOW AN AGENT FINDS YOUR HOME’S TRUE MARKET VALUE
So, how does an actual real estate agent determine true market value? They’ll start by doing a comparative market analysis (CMA). This means they’ll compare your home’s features to similar properties in your area. For the CMA, the agent looks at the below factors to influence their assessment of your home’s worth:6
● Neighborhood sales - Your agent will look at similar, recently sold homes in your neighborhood to see what they sold for and what they have in common with your house.
● The exterior - What does your home look like from the outside? Your agent will factor in curb appeal, the style of the house, the front and backyard, and anything else that impacts how the house looks to everyone walking and driving by.
● The interior - This is everything inside the walls of the house. Square footage, number of bedrooms and bathrooms, appliances, and more all influence the overall market value.
● Age of the home - Whether you have a newer or older home affects the number your agent comes up with as part of their assessment.
● Style of the home - The style of your home is important because buyers in different markets have different tastes. If buyers prefer ranch-style homes and you have one, then your home may sell for a premium (aka more money!).
● Market trends - Because a local agent has so much experience in your market, they have their finger on the pulse of your area’s trends and know what buyers are willing to pay for a property like yours.
● Location, location, location- This one’s probably the most obvious. Your agent will think about how popular the area is, how safe it is, and what schools are like.
A computer algorithm simply can’t take all of these factors into account when calculating the value of your home. The reality is, nothing beats the accuracy of a real estate agent or professional appraiser when it comes to determining a home’s true market value.
YOUR AGENT IS THERE EVERY STEP OF THE WAY
Determining a home’s true market value is a real estate agent’s forte. If you’re a seller, your agent will help you find your home’s market value so you can list it at the right price.
For buyers, your agent will help you determine the value so you can come up with a fair offer. Your agent can also set up a personalized home search on the Multiple Listing Service (MLS) for you so you’ll receive emails of listings that meet your criteria. This will help you see what’s out there in your city and how properties are being priced.
Get a Complimentary Report With Your Home’s True Market Value
Curious about your home’s true market value? Contact me at tara@lakere.com to request a free, no-obligation Comparative Market Analysis to find out exactly how much your home is worth!
Sources:
1. Chicago Tribune -
2. SFGATE -
https://homeguides.sfgate.com/market-value-vs-appraised-value-1206.html
3. ValuePenguin -
https://www.valuepenguin.com/mortgages/what-is-the-assessed-value-of-a-house
4. Movoto -
https://www.movoto.com/blog/homeownership/assessed-value-vs-market-value/
5. Zillow -
https://www.zillow.com/how-much-is-my-home-worth/
6. Realtor.com -
https://www.realtor.com/advice/sell/assessed-value-vs-market-value-difference/
What To Expect When You Meet Tara!
Never met Tara before? Spoiler alert - she’s not like other realtors.
If you’ve had experiences with other realtors, or never met anyone in the real estate business before, you’re in for a treat. Here’s a little more about what you can expect from your first rendezvous with Tara:
Read MoreKeep In The Loop
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Read MoreOutdoor Updates: Happy Homeowners & Financial Returns!
I bought a fixer. Not only the house and its systems needed an overhaul, but the yard did too. We brought in dirt, we took out dirt, we have terraced and leveled and sodded and fenced….
Guess what, it made us really happy…like “new kitchen” happy. We have only finished the front yard! This article from the Realtors made me feel much better about our investment.
Winter may be a good time to get some of the major work done. Landscapers are not as busy and you can have it complete by Summer! Please let me know if you would like some referrals of contractors that can help with your projects.
For more information on the impact of outdoor remodeling projects, visit
Local Business Spotlight: Marni Saves the Day
Hello Everyone! I must introduce a friend of mine, Marni, owner of Marni Saves the Day. I was lucky enough to meet this wonderful lady a few months ago when out-of-state clients decided to sell their Seattle house. These clients were not only living in Portland, but was also taking care of an ailing parent. Preparing your home to sell is a lot of work, and lucky for them, Marni was there to help.
She was so fantastic to work with, I decided to hire Marni to help me get my home and office in order. Between my business doubling and having a brand new baby, my house was in a state of chaos. Marni has helped me clear out boxes of “stuff” that I don’t need, move offices, prepare for a basement remodel and throw a HUGE holiday event (You may have met “Jingles the Elf” at the Holiday Social). She has boundless energy and an ability to keep me focused when I am frazzled and overwhelmed.
I think my favorite part about working with Marni, is that she makes sure that the things that I don’t need either goes to someone who does need them or is disposed of correctly. For example, I had too much food for the Holiday Social. She suggested that we hand it out to the homeless. Her passion is contagious.
If you need help organizing, moving, preparing for a remodel, hosting an event, decluttering, or filing, you should contact:
Marni Jacobsen | 206-372-9968 | marni@marnisavestheday.com | MarniSavestheDay.com