How do we determine Value?
Many of our clients question how the value of their home was ascertained. They see various price quotes on Zillow, Public records, assessors office. All of these values are accurate but they serve very different purposes. It is important to understand what each number represents.
Assessed Value: Value determined by local municipality for tax purposes only. You pay property taxes based on this value. It has nothing to do with the resale value of your home.
Appraised Value: An Appraiser is hired to determine value that banks are willing to lend on. Essentially, they want to find similar homes in the area that have sold and how much they sold for. They then compare your home to this home and assess whether your home is worth more or less.
Market Value: What a buyer is willing to pay for the property. It is a combination of Appraised value, inventory, and demand. We understand that if there are several homes on the market listed around $500,000 but none of them are going under contract… these homes are more than a buyer is willing to pay. However, if homes at this price are going under contract within days/weeks, we know that buyers are willing to pay within this price for homes in the area.
Determining the value of a home for Sale is a little more in depth than simply reviewing comparable homes.