Our guide for home buyers and sellers:
Homeowners often ask us, "How much money can I get for my house?" Prospective buyers want to know, "How much house can I get for my money?" To help you find a clear path through the often-confusing real estate thicket, we've put together the following guide for understanding the complexities of the real estate market, such as determining the difference between the value of a house and how much it will actually sell for.
Estimating a home's value
The value of a home is based on a variety of physical factors, including condition, amenities and location. Real estate agents use both home appraisals and comparative market analyses to determine a property's value.
Home appraisals
A certified home appraiser determines property value by considering the following variables:
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- Structural design
- Exterior landscape
- Quality of neighborhood
- Access to transportation, shopping and schools
- Property square footage
- Lot size
- Construction quality
- Floor plan
The comparative market analysis of a home is an informal estimate of a house's value based on comparable home sales within the local market area. This analysis is performed by your real estate agent and is often used to help determine the asking price of a house.
You can even perform your own analysis by looking up public records of recent sales of comparable homes -- some of which are now published on the Internet.
No matter what the estimated value, a house is only worth as much as its highest bidder is willing to pay.
A home's worth is measured by the highest attainable price it can be sold for. Current market conditions are an important factor in this equation. In addition to the basic rules of supply and demand, worth is altered through changes in the following:
- Stock market performance
- Population distribution
- Employment rates
- Consumer taste trends
- Time of year
- Weather
- Location
- Interest rates
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