It’s common for homeowners to wonder at one time or another, “What is my home worth?” It’s an important question because the net worth of most Americans is tied to the market value of their home. A home’s value determines how much a homeowner can potentially sell their home for, as well as the amount someone can borrow through a mortgage refinance or home equity line of credit. With so much depending on the value of homes, it’s no wonder homeowners are concerned with their property’s value.
Fortunately, there are many online tools including home value websites easily available that one can use to get a quick property value estimate of their house. If you’re willing to pay for a more thorough and personalized estimate, consider consulting a real estate agent or a property appraiser who can determine your home’s value.
Use Online Home Appraisal Tools
There are many online tools that serve as home value estimators. Here’s how two of the most popular home value websites, Zillow and Trulia, calculate home value estimates:
- Zillow: The Zillow estimate, or “zestimate” as it is called, uses an algorithm based on many factors, including assessed values and recent sales, to come up with an estimate of your home’s worth.
- Trulia: Trulia’s home value is also based on similar factors, together with including a property value map that is useful in seeing, not only the value of your home but also of all other properties in your neighborhood.
Home values may vary greatly from site to site, but for many homeowners, an online estimate is sufficient for them to get a general idea of how their real estate investment is performing.
Use a Real Estate Agent
If you want a more precise value of your home beyond an online estimate, consider consulting with a local real estate agent. A realtor is knowledgeable about your local market and has intimate knowledge of nearby schools, neighborhoods and sales that may not be reflected in an online estimate. These factors can give you a more accurate assessment of your property value. Most realtors will be happy to share their local knowledge with you or you can request that they do a market analysis of your home.
Use a Property Appraiser
Using online tools or speaking with a local realtor can give you an estimated home value quickly at no charge, however, there will be times when you need the most accurate value for your house. Such times include when you are seriously considering selling your home, refinancing a mortgage or obtaining a home equity line of credit. In these cases, it will be critical for you to obtain an appraisal of your home by hiring a property appraiser, which typically costs between $200-$450.
A full property appraisal will be much more extensive than an online estimate and will consider many factors that online tools may not consider. Such factors include:
- Condition: An appraiser will physically inspect the property and might even use a property inspector to determine the home’s true condition.
- Upgrades: The appraiser will assess any upgrades that have been made to a house such as a kitchen or bathroom remodel or a room addition.
- Property characteristics: An online evaluation of a home uses property information from the local property assessor’s office, however, that information can often be incorrect. Getting a full property appraisal will make certain that the most accurate information is used.
The question of “How much is my house worth?” is never far from a homeowner’s mind. Before considering which source to use in finding your home’s value, examine your motivation for finding your home’s worth. If you just want to casually track the value of your home to see how your investment is performing, an online tool is sufficient. If you are seriously considering selling or refinancing a mortgage, however, a full property appraisal is recommended to get the most accurate value.