Home Market Evaluations
Blog • November 7, 2019
What is a Home Market Evaluation?
A home market evaluation essentially determines what the selling price of your home should be. The evaluation should be performed by a registered real estate salesperson or a broker, to ensure the price is as accurate as possible. The salesperson will calculate the approximate value of your home by comparing similar properties that have recently sold in the area, and by inspecting all features and amenities that could set your home apart from other listings in the area.
The Importance of a Home Market Evaluation
Home market evaluations are completed by registered real estate salespeople or brokers and because of this, the analysis and calculations are all based on the same principals. This ensures all homes on the market are priced fairly and accurately.
Buyers also benefit from home market evaluations seeing it allows them to eliminate homes that are not in their budget. Without home market evaluations, it would be a guessing game when selling or buying a home.
The Steps Involved when Creating a Home Market Evaluation
A realtor can create a home market evaluation, to give you an estimated home value, by using recent market data. This requires an in-depth database search of all home listings near your property. The following data must be included:
- Pending Listings: The actual sold price of pending listings are not available, seeing the sale has yet to close. These listing cannot be used as comparable sales nevertheless they indicate the direction of the market.
- Active Listings: When it comes down to it, sellers can list their home for whatever dollar amount they wish. This means active listings do not reflect market value until they sell. Unless the active listings are in direct competition, in this case, the listing is useful.
- Sold Listings: These are used to help determine the market value of other homes and provide comparable sales.
- Expired Listings: Expired listings are homes that did not sell, most likely because they were overpriced.
- Canceled Listings: There are many reasons sellers remove their home from the market but one of the most common reasons is simply because the asking price was too high.
Examining Comparable Sales
Through examining comparable sales via listings, homes are narrowed down to those that closely resemble the home you’re trying to sell or purchase. Other factors such as square footage, location, amenities, upgrades, age of construction and the overall condition are considered and compared to similar properties. These comparisons allow for a fair market value of the property.
Having a home market evaluation completed by an experienced and respected salesperson will ensure your home buying or selling experience is successful.
If you are looking for a home market evaluation I am happy to help. Contact me today and let’s get started!
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