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Appraisals & Market Value

Click a question to jump right to the answer:

  1. Can I find out the value of a home I am seeking to purchase through the internet?
  2. How is a home’s value determined?
  3. What is the difference between list price, sale price and appraised value?
  4. What is the difference between market value and appraised value?
  5. What standards do appraisers use to estimate the value of a home?

Can I find out the value of a home I am seeking to purchase through the internet?
It is possible to get a rough estimate of the home you are seeking to purchase via the internet. But, if you are looking to obtain the true value of the home when making an offer, it is best to speak with your Magnificent Manors Realtors ® who will put together a CMA (comparative market analysis). Your Magnificent Manors Realtors ® will factor in features, upgrades and attributes that automated online calculators cannot, and therefore their analysis will be far more accurate and will ensure that you do not over pay for your new home.

How is a home’s value determined?
A home’s value can be determined using multiple techniques.
– CMA: Prior to listing a home, a Realtor ® will perform a Comparative Market Analysis (CMA) which estimates the value of a house based on recent sales of similar homes in your area. This CMA is one of the tools used to set the sales price.
– Appraisal: Lenders require that an appraisal be performed prior to closing to ensure the home’s value is not less than the loan amount. Appraisers also base their estimates on prior sales in the area, square footage, location, and home features and upgrades.
– Assessment: Assessments are periodically performed on homes by local governments to evaluate the home’s property taxes. Since property taxes are based on property value and sales, features such as location, size of lot, age of home, and home condition are factored into the assessment.

What is the difference between list price, sale price and appraised value?
The list price is how much the seller’s asked for when placing the home on the market. The sale price is how much the home actually sold for. And, the appraised value is the worth a professional appraiser estimated for the home. Lenders often require an appraisal prior to closing to ensure the home’s value is not less than the loan amount.

What is the difference between market value and appraised value?
The market value of a home is the estimated price at which the home would currently sell. To obtain the market value of a home, agents will perform a Comparative Market Analysis (CMA) which will estimate the value of the home based on recent sales of similar homes in the area. The appraised value of a home is the worth a professional appraiser estimated for the home. Lenders often require an appraisal prior to closing to ensure the home’s value is not less than the loan amount.

What standards do appraisers use to estimate the value of a home?
Appraisers base their estimates on several factors such as prior sales in the area, square footage, location, home features and upgrades. A copy of a home’s appraisal detailing the standards the appraiser used to reach his or her estimate will be provided to the buyer’s lender after the appraisal has been completed.