If you own a home it is always a temptation to see how much that home is worth, either because you might be thinking of selling it or because you are just curious.
If you are just curious you can use one of the many online sources out there, your Zillows, etc. On my site I have a link where you can get an idea or the value, but these are not boots on the ground evaluations. They are automated and not terribly accurate. Computers have never seen your home and have no way to compare it with other homes that have sold recently. If you are just kicking tires and not serious about selling this might be good enough. But if you need accuracy you are going to have to pay for an appraisal or talk to a Realtor®,
How is the value of your home determined? The appraiser will go a lot deeper into the analysis than the Realtor® and be more conservative because they are looking at the value in terms of how much can be loaned on the property, but they and the Realtor® use the same basic information, comparable sold properties. Comparable means similar homes in the same neighborhood which have sold over the past six months. If none have sold in that area or time period then they will have to extend the time period or maybe look a little further than the immediate area.
Next your home will be compared to the sold properties, specifically age, condition, size location on the street, and amenities. Like for like. When comparing condos for instance, a similar unit on a higher floor or a better exposure is going to command a slightly higher price. On the face of it two houses are similar in all respects except for lot size, or one may be near a school; those facts will be taken into consideration. Above all, the only real comps are those that have sold. Homes that are still on the market may not end up getting their list price and you will not know the final sold prices of those currently under contract. Active listings are a good indication of how you may want to price your home if you put it on the market so that you remain competitive, and you will know that are probably overpriced from the amount of time they have been on the market.
So you see that an automated valuation tool cannot take all the above factors into account. You may get lucky and the price may be close, but for an accurate account you will need human analysis.
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