What is the True Value of a Home?

What is the True Value of a Home?

This is the question that everyone wants answered. How much is my home worth?

Or, what is the value of the home that I am buying?

The reality is that the value of a home is a moving target. There are many factors that impact a home's value, but the main criteria are:

1. Location

2. Condition

3. Comparable market sales

Let's quickly look at each factor. First is location. Is your home in an area that appeals to many buyers? Is the lot level or sloping? Is it close to shops, or far from the nearest grocery store? Is the view appealing, or are there eyesores on the neighboring properties? All of these issues have an impact on value.

Next is condition. In my market area (Central Massachusetts), buyers either want a home in move-in condition at a great price, or a home that needs repair at an even greater deal. Updated homes sell more quickly and usually for a higher price. Buyers want to see fresh paint, new appliances, no wallpaper, clean flooring, and a well-maintained lawn. The roof, plumbing, and heating must be in good condition. If not, the value quickly falls.

Lastly are the comparable home sales. A home's value is greatly impacted by sale prices of similar homes nearby. Note: A similar property that is currently active on the market has no impact on another home's value. It must be a property that has sold.

Many people will use sites like Zillow to try to figure out a home's value. This may be a good starting point, but even Zillow has a margin of error. Zillow is a computer program that obtains information from a variety of data sources. It does not know if a property has beautiful views or an outstanding kitchen. Zillow does not send out live representatives to examine each property on its site.

To find an accurate value for a home you need either a real estate agent

or an appraiser, who can perform a detailed valuation.

To sum up, the true value of a home changes constantly. Be prepared to be flexible when trying to determine the value of a property.

Submitted by Kathryn Acciari, REALTOR
Certified Investor Agent Specialist (CIAS)
Certified Distressed Property Expert (CDPE)