Home's Market Value

In the real world, very few individuals order appraisal reports to establish an offering price or to substantiate a purchase price. At the point that an offer to purchase (in a typical residential transaction) is made, the price has been set by other parties, not the purchaser. The price has been determined by the seller, who wishes to obtain the highest price possible, or the agent, who receives a percentage of the price as compensation and often represents the seller in the transaction.

The sellers realtor's job is to do market analysis and price the property accordingly. If the sellers realtor did there job correctly then the asking price should be a correct asessment of value.

There are different types of housing values available. One type of housing value is the assessed home value which is assessed usually by your county auditor. Usually your assessed home value is less than the actual market value of your home may be. This is usually a good thing because the assessed value of your home is generally the basis for your property taxes.

Often, the asking price for the home is based upon comparable sales in the area - similar homes that have sold recently. Using the selling prices for those homes, they can determine what the home should sell for, and price the home accordingly.

Before buying (or selling) it is wise to do some homework and look at what similar homes in your neighborhood or town have sold for recently. This information is available at county recorders offices, town offices, and from some websites. Of course, the ultimate is to have an appraisal done by a professional appraiser. This will be done anyway before any lender provides the purchase money loan.

» DISCLAIMER: The information contained in this article on 'Home's Market Value' is a collection of contributions by licensed mortgage professionals and is not the opinion of Broker Outpost LLC. Always consult a licensed professional before applying for a mortgage.