Every homeowner has a theory on what their property is worth – it’s a universal truth in which your opinion is based on local media headlines, a smattering of online ads and a personal assessment of the market mood.
And when the good times roll, as they are right now with property prices, it’s fun to think how much money you’d make if you sold today.
Of course, that ignores the reality that, firstly, you’d likely have to purchase another home in a rising market, and that the true value of your home is not decided by a market feeling but an eventual buyer.
And you can’t rely on the internet portals, either. There can be a gap between the asking price paraded on real estate websites and the eventual size of the deal.
So you need to be cautious in your assessment, especially if you’re thinking of either climbing the property ladder, or downsizing and stashing away some money for your next adventure.
As an experienced local real estate agent, I’d be happy to provide you with an evaluation. As someone who is at the coalface of the property market, I’ve access to a host of data sources to identify price trends in our neighborhood over many years. I can show you how that has played out over recent months and even show how it is influenced by the seasons.
If you’re just kicking around the idea of selling at the moment, maybe you’re not ready for that conversation. So, I’ve pulled together a quick list of ways in which you can gauge the value of your home with a degree of accuracy.
- Check-out the prices of homes similar to yours that were sold in the neighborhood recently. At minimum, they need to have the same number of bedrooms. They won’t be carbon copies so they’ll only provide an approximation. Find three homes to compare against, otherwise your assessment will be a little flaky and try to find homes with similar features to yours.
- Grab your calculator and calculate the price per square foot that properties are selling for in your neighborhood. That’s a pretty good gauge, especially if you’ve found three properties similar to yours that sold recently. Focus on the living area, and there’s no pass for including the half-renovated basement.
- Build into your equation and the age, size and location of your home, too. If you’re near a mall, or a popular café spot, then buyers will pay a premium. Unfortunately, it’s impossible to know what that might be until you test the market.
- Check your property tax bill. Of course, it’s not an estimate of value but it’s another piece of data. Tax assessments are made periodically, so take a note of when yours was last issued.
- By now, you’ll be getting close to a true value. See if you can validate it using an online tool that is available on one of the portals. This isn’t science either, and you can’t expect an algorithm to understand the cool selling points of your home. But it will offer another approximation.
- Are you in a buyer or seller’s market? If you are thinking of selling when buyers have a big choice, your price is going to come under pressure. Supply and demand plays a big role in determining price, and it can swing from abundance to drought in just a few weeks.
- If all this sounds like a hassle, you can order an evaluation from a professional assessor and get what we call a “broker price opinion”.
- Folks will say a broker price doesn’t come with an agent’s sales pitch. But seriously – if you’re thinking of selling, it’s smart to do business with someone who knows how to maximize the value of your property.
- When all is said and done, it won’t be you, me or the professional assessor who will determine the final value – it’s going to be the prospective buyer. Then, it will be up to you to accept the offer.
A final thought as a long-time, reputable agent in our neighborhood, I have seen markets swing from positive to negative, and vice-versa. Right now, interest rates are at record lows and the market is healthy.
This means you’re very likely to get a great price, but you’ll face the challenge of a strong market if you need to buy again. The best reason to sell is not the price you think you’ll achieve, but that moving home suits your life plan and goals.