In recent months, the housing market has seen dramatic increases in home values across the country. Many sellers have chosen to take advantage of the increased equity that came with higher home prices. As a homeowner, you may have found yourself asking more than once this year, “how much is my house worth?”. Let’s take a closer look at some of the most common and effective ways to determine your home’s value.
How Much is My House Worth: Types of Valuations
When asking how much is my house worth, there are a few types of valuations to consider. Each of these home valuations has a different meaning, and varies in how it is calculated.
You’ve likely heard of appraised value. When you purchase your home, it was appraised. Mortgage lenders look at the appraisal amount when the borrower buys a home. Appraised value is determined by a professional appraiser. They will take into account the value of comparable homes in your local market and recent sales. With that, the appraiser also considers location, home size and condition, and any home improvements the owner has done.
Essentially, appraised value is the true value of the home. While sale price is dependent on the current market’s supply and demand. For example, if you sell your home during a sellers market, many homes sell for over appraised value simply because demand for limited listings is so high.
Assessed value concerns how much your home is worth from a tax perspective. It is used by local county tax assessors in order to determine your property taxes. Assessed value is determined by a number of factors, and includes both fair market value and appraised value. With that, tax assessors also consider renovations, whether any income is generated by the property and any tax exemptions the owner is eligible for.
Overall, assessed value is much lower than appraised and market value. With that, it does not reflect how much your house is actually worth when sold on the open market. Instead it helps you determine how much you will be paying in taxes each year.
Fair Market Value
Similar to appraised value, fair market value takes into account comparable homes when determining how much your house is worth. Specifically, fair market value looks closely at homes similar to yours based on square footage, outdoor space and the number of bedrooms and bathrooms. Ultimately, fair market value can be thought of as the amount buyers have been willing to pay for a house like yours.
This valuation method is also referred to as comparative market analysis. When working with a real estate agent, determining this value is likely the starting point for determining a list price for your home.
How to find out how much your home is worth
Home value estimator
When asking how much is my house worth, an automated valuation model or AVM is often the quickest way to find out. Sites like Zillow and Redfin have their own AVMs. These use comparable home sales and other factors to estimate a home’s likely value.
This method uses an algorithm that considers the details of your home that an appraiser would also take into account. However, these algorithms often have no way of knowing what recent upgrades the home has, its current condition, or factors like distance to local schools and noise from traffic.
Home value estimates are also used by iBuyers to determine whether to purchase a property directly from a seller.
The Bottom Line: Home valuation calculators are convenient. But they are not as accurate as an appraisal, or a market analysis by an expert real estate agent. They occasionally miss important home updates or other details and may not accurately reflect your home’s value.
Ask a real estate agent for a free comparative market analysis
Typically, many real estate agents offer a free comparative market analysis (CMA) for those interested in selling their home. To provide a CMA, the agent will pull data from similar homes that have recently sold in your area. Then, they use local market knowledge to evaluate characteristics of your home to determine a value estimate.
If you choose this method to answer the question how much is my house worth, be sure you choose your real estate professional wisely. Read reviews online, and ask questions about their experience with home’s similar to yours. Your agent should be an expert regarding local market trends, and understand your preferred communication methods throughout the selling process.
Hire a professional appraiser
When asking how much my house is worth, some sellers will opt to hire a professional appraiser. This option provides similar information to a real estate agent’s comparative market analysis. However, hiring an appraiser costs between $300 and $450, while a real estate agent can provide market data at no cost.
Alternatively, if you’re asking yourself how much is my house worth in hopes of opening a home equity line of credit, it’s normal for your lender to require an appraisal.
How Trelora Estimates Your Home’s Value
Based on the most up-to-date data available
Trelora uses data directly from the multiple listing services (MLSs), the databases that real estate agents use to list properties. We use MLS data on recently sold homes in your area to calculate your home’s current market value, a Trelora agent will use MLS data from recently sold homes in your area.
Backed by Trelora Agent expertise
When you’re ready for a professional home-value estimate and comparative market analysis, connect with us. A Trelora real estate agent who specializes in your neighborhood can evaluate your home in person and give you pricing recommendations based on a variety of factors. Trelora agents work with hundreds of home buyers and sellers each year. Plus, we have a team of dedicated pricing agents who see more homes than any other agents. This enables them to give you the best possible recommendation for your home.
If you’re thinking about selling, a home value estimate from Trelora can help you understand how much you’ll get for your home on the open market. It’s also a great way to better estimate how much you’ll likely pay for homes you’re interested in if you’re house hunting. Trelora Real Estate is in 7 states across the country, and can provide a home value estimate in these areas, Atlanta, Charleston, Charlotte, Denver, Phoenix, Raleigh, Seattle, St. Louis and Tucson.
Christina Parker co-founded Trelora’s North Carolina branch in 2020 and has successfully closed 330 deals as an agent. She was promoted to Market Director in 2021 as Trelora expanded to serve homeowners in Charlotte in addition to their hub in Raleigh.