The first thing most homeowners want to know when they are looking to sell a home is to determine its price. Your property is likely your greatest asset, so it’s important to know the value before offering it for sale. There are three significant ways to evaluate your property.
We all love you surf Zillow and see what our neighbors are selling their homes for, but the reality is that Zillow estimates can be wildly inaccurate and give inflated or deflated numbers. So, don’t go by the Zillow estimate (or any other automated valuation). Instead, use these online tools to get an idea of your home’s value:
An appraiser will look at the last 6 month’s of closed sales, so we will do the same thing. Go to either Zillow or Realtor.com and search for an area of half a mile around your home for sales that have closed in the last 4 months. We pick 4 months – and not 6- because you will likely sell your home in about 2 months or more. We are accounting for the lag. If there are no closed sales using those parameters, then expand your search to 1 mile.
Next, filter your search by properties that have a similar age, size, bedrooms and baths. This will give you an idea of the price range comparable homes are selling for. This tells you where the market WAS. To figure out where the market is GOING, you need to look at pending sales below.
In order to determine where your real estate market is heading (up or down), you need to change the criteria to look for “active” and “pending” sales, which can also include “contingent”. These are homes that have not yet closed. They will give you an idea of where your market is going. If you see that pending and active prices are higher than the closed ones, then your market is trending up. If it’s the opposite then your market is trending down.
Get a real estate agent for a CMA
Realtors love listings and they will give you free information if you give them a shot at listing your house. Call a few Realtors in your area and tell them you are interested in selling your house and would like a CMA (comparative marketing analysis). This is like a mini-appraisal. They will provided it to you for free or for a small fee, and it will give you great pricing information for your market. It informs you of the cost of similar properties on the market. Careful though, the downside is that some agents have a penchant for over-valuing properties to win clients.
Talk to a Professional Cash Buyer
Often, homeowners shy away from talking to professional cash buyers because of their reputation. But legitimate cash buyers exist and will give you good advice on the condition and value of your home. Selling to a “retail buyer” is not always the best way to sell a home, and talking to a reputable company gives you a good option if your house needs some TLC or updating.
Hiring a professional appraiser
Hiring a professional appraiser can help you get an independent estimate of your property. The appraiser will physically inspect the property, conduct a local market review, and compare your property against the prices of sold properties in the area to determine its value. Going the route of a property evaluation may cost you hundreds of dollars, but this investment will ensure you are no longer in the dark about the actual value of your property.
Following this process will help you get a realistic value for your home. Whether you conduct the research yourself or hire a processional to do it, the money and time spent is well worth it because you will have data available for you to make a decision about home much to price your house for when you sell it.