What is my house worth in today’s market?

August 13, 2010 // 2 Comments »

I hear or receive this question no less than 2-3 times per month. On the surface, it would seem to be a rather innocent, simple question. However, on deeper analysis it becomes infinitely more complex and convoluted than most folks imagine. I’ve decided to tackle this question – “What’s my house worth?” – and give you my personal and professional response to it:

Dear Homeowner,

I don’t mean to sound flippant, but what your house is ‘worth‘ depends on the opinion of the specific person evaluating your property. An appraisal is an opinion of one person, a licensed appraiser. A BPO (Broker Price Opinion) or CMA (Comparative Market Analysis) is an opinion of one real estate agent or broker. An offer submitted by a prospective buyer is yet another opinion of one person.

How many opinions of value might there be? >>> As many as there are people on the planet!

Here’s a reality check for you homeowners:  Valuing a property is an art, not a science, and the folks who are best at this art are those who consider ALL of the factors relative to any given property. Here’s a short list of the 5 biggest factors to consider:

• Recent ‘comps’ (comparable sales) within the past 3-6 months that are reasonably similar to your property
• Major improvements, options or upgrades (or lack thereof), e.g., private pool, granite counter-tops, new roof, new AC, etc.
• Age of the home and surrounding neighborhood/subdivision
• Location of your property
• Curb appeal of your property
  

Beyond these, there are an infinite number of other factors and variables that can weigh on the perception of any given person. You simply cannot rely on the tax assessor’s valuation, Zillow’s Zestimate, or any of your friends, family or neighbors. You need the advice and counsel of an objective, third party professional who can give you an experienced, knowledgeable opinion. And even then, there is not one finite number that can possibly represent the TRUE value of your home – but a projected sales price range can be estimated by the right professional.

The best advice I can give you is to contact a local, experienced real estate agent or broker with whom you feel good, and that you trust. S/he should be able and willing to do the appropriate research and then counsel you regarding your options and objectives – and ultimately, the best strategy for YOU. Make sense?

Posted in arizona home sellers