When it’s time to sell your home in The Roanoke Valley, there can be some confusion when determining value. If you REALLY want to know what its worth, you can pay to have an appraisal done. Or a real estate agent can provide you with a detailed CMA report, letting you know what’s going on with prices in your town. Knowing the differences in these methods of valuing homes can help you set your ideal asking price!
What is Market Value vs Assessed Value in The Roanoke Valley?
Market Value by Definition:
According to Fannie Mae, “Market value is the most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus.”
In other words, this is the amount you can expect to get if you keep your house on the market for a few months (a normal number of days on market) provided everything goes smoothly and you have potential buyers coming to see your home on a regular basis. A professional real estate agent can complete a Comparative Market Analysis (CMA) based on homes that are comparable to yours (comps), and that have sold within the past 12 months.
Our team can prepare a CMA for you at your request. To get the process started, click here and begin to enter your home’s information.
Assessed Value by Definition:
According to Investopedia, “An assessed value is the dollar value assigned to a property to measure applicable taxes. Assessed valuation determines the value of a residence for tax purposes and takes comparable home sales and inspections into consideration.”
Understanding assessed value can be a bit confusing. City and county property assessors give values to homes for tax purposes, however, these values are not always reflective of changes in market value. In good economic times, the assessed value is often well below the price the house would actually bring on the open market (market value). The difference between the assessed value and the market value is known as the equalization rate. This rate is used by the county to figure your actual property value.
But wait, there’s more. Your appraised value can differ from both of these. An appraisal is done by a licensed professional appraiser who rigorously checks all aspects of the home. While they might be 100% correct based on their numbers, this is still the opinion of one. Whereas other methods are mathematically calculated based off of your home’s history, possible rents, and market conditions. Our team can recommend several very reputable appraisers in The Roanoke Valley, just contact us and we’ll give you the names and numbers.
What The Internet Has To Say About It:
The large real estate sites have their own formulas for determining property values using the AVM (Automated Valuation Model). These values are broad, based on market conditions of many “non-comparable” homes, and use information entered by site users. They do not always accurately reflect YOUR home’s value. Think of it as Kelly Blue Book, but for homes. It is an algorithm’s guess at determining your home’s value, but your ACTUAL market value can be much different. People report seeing these numbers off by 10% to 50% and even more! And who could blame them? That algorithm didn’t drop by to see all of the improvements you have made, or care about your new appliances or your landscaping.
What it Means For You As A Seller:
Do your homework! Make sure you understand terms mentioned above, and the difference in valuation models. Make sure you are working with a true seasoned professional who can help you to accurately determine the market value of your home.
Setting a great asking price is critical. You do not want to set it too high and have to repeatedly lower it to get buyers in the door. Your pricing history is public information, and repeatedly lowering your price can make buyers think there is something wrong with it. And for obvious reasons, you don’t want to set your asking price too low. To get the price you want you must exercise patience and make sure you are working with a true professional in The Roanoke Valley.