July 28, 2021

Calculating the value of your home.

all expert tips
By

Jacee Monsalve

Calculating the value of your home.

When getting ready to sell, putting a dollar value on your home involves more than checking the Zestimate. It involves not only an objective analysis, but also some subjective decisions. To start, you need a baseline understanding of what your home should appraise for. Next the focus should be on the more subjective factors that influence the final listing and sales price.


Objective

Comps

To get a baseline price, you need as many comps (comparable sold properties) as possible. Comps should have the same, or close to the same number of bedrooms, bathrooms, square footage, be in the same general condition, and so on. If you find 6 comps that average $200/square foot, then use that as your starting point for what your home is worth. In this case, if your house is 2,000sf, then your baseline price would be $400,000 (2,000sf X $200/sf).

Adjustments

Once you have a baseline price, you need to make adjustments based on the specs or features of your home. If you have an extra half bath or garage space, that could be an extra $5,000 in value. If most houses sold with a pool and you do not have a pool, that could be a $20,000 deduction or potentially much more depending on the area. Keep in mind that condition is only appraised based on general grades, so a brand new AC and water heater typically adds zero appraised value versus a house with a 5 years old AC and water heater.



Subjective

Competition

If your house would appraise for $400,000, but your neighbors down the street have a very similar house listed for $370k, it may be harder to get $400k. At the same time, if those same neighbors over-listed for $430k, maybe you could sell for even more than $400k! Part of your process in calculating price will need to include some subjective decisions on your sales strategy.

General Features

On an appraisal, there is no line item adjustment for things such as a great v bad layout, new 42” hardwood cabinets v good condition ugly cabinets, pretty v ugly tile, and more. These things can impact the final sale price by tens of thousands of dollars, but do not impact an appraisal as much as people expect them to. When it comes down to it, you will have to use your best judgment to determine what the features of your home actually will be worth to the market.



When you are getting ready to sell your home, enlist the help of an agent who combines knowledge, experience, and action. Call us today or fill out the form here to get in touch.

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