Home Valuation
How Much is Your Home Worth?
How Much is Your Home Worth?
Home valuations give you valuable knowledge that can help you plan for the future and make smart decisions. It’s good practice to stay informed about how much equity you have in your home and how much you may be able to borrow against it or sell it for.
Our tool provides a more robust, accurate assessment than you’ll get from the major real estate portals. For the most precise valuation, reach out to discuss a customized Comparative Market Analysis or an appraisal.
Frequently Asked Questions
01 What is a Home Valuation?
A home valuation determines the current market value of a residential property. It is crucial for real estate transactions, preventing excessive borrowing and financial losses. When getting a mortgage, the home acts as collateral. If the borrower defaults, the lender may sell the property to recover funds. A thorough home valuation safeguards the lender’s ability to recover costs if the mortgage is not fully repaid.
02 How is the Valuation of My Home Calculated?
Your home’s value is determined by analyzing recent sales of comparable properties in your area, current market conditions, and the unique features of your home. Key factors include location, size, layout, condition, upgrades, lot size, and overall demand in your neighborhood.
Automated valuation tools use real-time market data and trends to generate an estimate, while a professional valuation considers deeper insights such as local pricing strategies and buyer behavior. For the most accurate assessment, a personalized review by a real estate expert ensures your home is positioned correctly within today’s market.
03 How Accurate is the Online Home Valuation?
Online home valuations provide a good starting point and offer a general estimate of your property’s worth. However, they may not factor in recent renovations, unique features, historical value, architectural significance, and subjective market perception that could impact your home’s actual market value. For the most accurate assessment, consider scheduling an in-person appraisal.
Still Have Questions?
How Is a Valuation Performed?
Comparative Market Analysis
Agents find comparable sales and use them to conduct a sales comparison. In most cases, an agent will identify three recently sold homes that are as similar to—and located as close to—the property being valued as possible.
Each home is analyzed to pinpoint differences compared to the subject property. Once these differences are priced out, each comparable is adjusted to reflect what it would sell for if it were identical to the home being valued in the current market.
Based on a Professional’s Opinion
An appraisal is an unbiased valuation of a home based on a professional opinion. It is typically used by mortgage companies for home purchases and refinances.
A lender usually orders the appraisal, and the cost—sometimes up to $500—is generally paid by the homeowner. The appraiser conducts a complete visual inspection of both the interior and exterior of the property.
The appraiser also considers recent sales of similar properties and current market trends. A detailed report is then prepared, which may include an exterior building sketch, a street map showing the home and comparable sales, photos of the property and street, an explanation of how the square footage was calculated, and other relevant information.
Why Is a Valuation Important?
Lenders base the amount of their loans on the value of your property and usually allow you to borrow a maximum of 75% to 96.5% against your property. Knowing what your home is worth allows lenders to calculate your equity in the home. The more equity you have, the better terms you will receive on your refinance.
If you’re doing home improvement projects to increase the resale value, you want to make sure you’re not pricing it out of the market. If your home is already priced on the high-end for your neighborhood, making too many improvements could make it more difficult to sell. When you get a valuation, you can see how your home compares with others in the neighborhood and let this guide your home improvement decisions.
If you want to borrow cash against your home, getting a Home Equity Line of Credit (HELOC) could be a good option. To qualify, you must have a certain level of equity in your home. Most lenders require at least 20%. Getting a home valuation will help you determine if you qualify and will be used by the lender to make a decision on your loan.
Though it’s not a necessity, simply knowing the value of your home is good information to have. It will help you plan for the future and deal with unforeseen circumstances when you might be in a position that requires extra money or a quick relocation. Knowing how much equity you have in your home and how much you may be able to borrow against it or sell it for will help you respond to any financial curveballs that life throws at you.
