How to Find a Home’s Value in 2024

Talia Lee-
July 05, 2024

As a homeowner, whether you’re gearing up to sell, considering refinancing, or simply curious about your equity position, it’s essential to have a clear understanding of your home’s market value. There are several methods to ascertain this, ranging from traditional research methods and online valuation tools to professional appraisals. Each approach varies in accuracy and reliability, so let’s explore these options to determine the most effective way to assess your home’s value.

To begin gauging your home’s value, you can conduct your own research to arrive at a rough estimate. Start by considering its purchase price and how the local market has evolved since then. Has there been significant appreciation or a downturn? Websites like Redfin, Zillow, and Realtor.com provide valuable pricing trends that can guide your assessment.

One advantage of DIY research is its cost-effectiveness — you avoid paying for professional services. However, accuracy can vary. “Home valuation is nuanced, influenced by many factors,” notes Jared Blumberg, co-founder of the Werner Blumberg team at Compass in New York City.

For more insights, check county and municipal websites for your home’s assessed value. These assessments, used for property tax purposes, are public and searchable online. While informative, assessed values may not reflect current market dynamics accurately.

Another tool is the Federal Housing Finance Agency’s House Price Index calculator, which tracks historical mortgage data to project home values at the state or metropolitan level. This tool offers insights into home price trends over time, indicating appreciation or depreciation in the broader housing market.

For a faster method of determining your home’s value, start by checking real estate websites for recently sold properties in your neighborhood that are similar to yours. This can give you a sense of current market prices. Additionally, there are several free online tools known as automated valuation models (AVMs) that use algorithms and public data like recent sales and tax assessments to estimate home values. Keep in mind that each AVM uses a different methodology, so estimates may vary significantly.

Some popular online home value estimators include:

  • Bankrate home value estimator
  • Zillow “Zestimate”
  • Realtor.com RealValue
  • Redfin home value estimator

In addition to using these tools, you might consider obtaining offers from iBuyers like Opendoor and Offerpad. These companies purchase homes directly from sellers for cash, aiming for a quick sale. However, they typically offer less than market value to account for their profit margins.

Another approach is to consult a local real estate agent familiar with your area. Agents can conduct a comprehensive comparative market analysis (CMA) to determine your home’s market value. While some may offer this service for free, others may require you to engage them to sell your home.

“A comparative market analysis involves a detailed examination of the housing market relevant to the property being assessed,” explains Blumberg. “It includes recent sales of comparable homes, homes under contract, and those currently on the market. Each category provides unique insights to ensure an accurate valuation of your home.”

When analyzing sales data of comparable properties, agents typically look for homes with similar square footage, quality, lot size, and number of bedrooms and bathrooms as your home. Local market conditions are also factored into the analysis.

A licensed appraiser offers another option for estimating your home’s value. Home appraisals are professional assessments that are typically based on an in-person inspection of your property, an analysis of recent comparable sales (comps), and a review of public records.

While a home appraisal comes at a cost (around $350 on average, according to Angi), it tends to be more precise than an online estimate. This method is particularly useful for unique properties or areas with limited recent sales data. “If your area lacks sufficient recent sales, it’s advisable to have an appraiser visit and provide their valuation,” advises Sacha Rady, a Realtor with Engel & Völkers in Atlanta.

Fair market value is a nuanced concept in real estate, representing the price that potential buyers are willing to pay for a home on the open market. This valuation is influenced by various tangible factors such as the home’s location, size, age, and condition.

In addition to these factors, less tangible elements like seasonality and specific market conditions also play a role. For instance, in a buyer’s market where there is ample inventory and fewer buyers, the fair market value of a home may be lower compared to a seller’s market where demand exceeds supply.

Competitive market dynamics can further impact fair market value. “In competitive scenarios with multiple interested buyers, bidding wars can drive up the market value of a home,” explains Rady. “This can result in the home’s market value surpassing its appraised value.”

It’s important to note that fair market value differs from appraised value, which is determined by a licensed appraiser, and assessed value, which is used by local governments to calculate property taxes.

Various factors can contribute to an increase in your home’s value. For example, prices may rise in areas with limited housing supply or robust local economies. If your home’s value has significantly appreciated, you might consider selling it to capitalize on the profit. Even if you’re not ready to sell, there are important considerations:

  • You could save money: If you currently pay for private mortgage insurance (PMI) and your home’s value has risen to the point where you now have at least 20 percent equity, you can request your lender to cancel your PMI premiums (although they may require an official appraisal).
  • You may need to adjust your insurance: The cost and coverage of your homeowners insurance are based on the cost to rebuild your home. If your home’s value has increased due to renovations or additions that would raise rebuilding costs, your policy may need to be adjusted accordingly.
  • You might have better options for home improvements: With increased equity in your property, you may qualify for a home equity loan, enabling you to invest in renovations or remodeling projects.

While home values have generally seen an uptrend nationwide, there are external factors that could lead to declines beyond a homeowner’s influence. These might encompass local economic downturns, repercussions from climate shifts or extreme weather events, or even local political developments. If feasible, waiting for the market to rebound rather than selling during a downturn may be the most prudent strategy.

Here are some ways to enhance your home’s value once you’ve determined its current worth. Begin with enhancing first impressions: Ensure the property boasts good curb appeal and looks inviting from the outside. Equally, maintain the interior in top condition.

These enhancements need not be overly expensive depending on your chosen projects. “Painting, landscaping, and updating old light switch plates or doorknobs can all significantly boost your home’s value,” suggests Rady.

More substantial investments that typically yield a solid return include energy-efficient upgrades and minor kitchen and bathroom remodels (as opposed to extensive renovations).

“If you do decide to renovate, make sure it’s done tastefully, timelessly, and with consideration,” advises Blumberg. “A renovation tailored to a specific taste or need may not hold its value well if you’re the only one who appreciates it in the long run.”

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