3 Ways to Determine Market Value
There are a few factors to consider when determining the market value of a property, whether it's new construction or resale.
1. Ignore the assessed value
An assessed value is used by a Town or City to determine a properties tax liability. Towns and cities consider many variables when determining the assessed value of a property. An assessor, hired by a municipality, will look at recent sales, home improvements, and potential rental income a property could generate. After gathering this info, the Municipality will multiply it by an assessment rate, which varies from each town or city. For example, if an assessor determines a property to be worth $200,000, and the particular Town or city has an assessment rate of 70% the assessed value of the property would be $140,000.
2. Comparable Properties
When determining the value of your home always evaluate comparable properties in your neighborhood that have sold within the last 6 months - not active properties. The true value of a home is the sold price not the price it is listed at. Also, keep in mind size, number of bedrooms & bathrooms, and features.
3. Supply and Demand
"Law of Supply and Demand states if supply is low, demand is high, price goes up and in contrast, higher supply, lower demand, price goes down". Now, take a moment and look at the current inventory within your market and apply the law of supply and demand to help determine your properties value.
Other elements to consider... curb appeal, your properties location, and exterior/interior conditions.
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