If you are not in the real estate industry, you are most likely unaware of how your home’s value is determined. Many individuals such as yourself believe that your home’s value is equivalent to the price you purchased the home with inflation. We hate to be the bearer of bad news but there are many other variables that must be considered when evaluating a home, and sometimes a home’s value can actually depreciate over time. To help you better understand what we consider when we value a home we have made a simple outline for you. So, if you are considering selling your home you can take a look around and see how your home compares.
The Real Estate Market and The United States Economy
The market is really what sets the price of your home. No matter the additions and upgrades you have installed, if we are in a bad market your home’s value may decline. But how can you tell how the real estate market is doing? A simple assessment of the United States economy can be your first indicator on how the real estate market is doing – generally, the economy is a direct reflection of the housing market. You do not need to be an expert in the field; instead, you can conduct a simple search on the internet and catch up on the national news headlines. This can be a great start to identifying how the economy and how the housing market is doing.
There is an exception to this assumption however. If you live in a highly sought out market, such as San Francisco, your home’s value may not be directly impacted by the market. But, if you live in an area such as Baytown, you can be sure that the local and national market will have an impact on your home’s value.
Market Comparables and Property Characteristics
Market comparables, or market comps, are essential when valuing a home, and if you can understand the data involved, you can even gain a better understanding of the economy via these comps. The first step is to understand, what are market comps? When your home is being evaluated, a professional will look at homes that have sold in your market or are available for sale in your market. This gives an understanding of price points for homes – more specifically, price per square foot. However, when completing this assessment there are many factors that need to be considered to determine if the comp is an appropriate one to utilize when evaluating your home. We at Gulf State Homebuyers consider a variety of aspects when evaluating a home, including: condition, year built, amenities and upgrades, number of bedrooms and bathrooms, square footage, and more. Every additional luxury can add value to a home. For instance, for 2019, homebuyers are seeking eco-friendly homes that provide adequate open spaces. Therefore, if your home matches what the buyers are looking for, your home could increase in value.
A unique home to value is one that has been damaged, say by a recent hurricane or a fire. These homes can be a bit trickier since they require much more upfront capital to improve. When evaluating a home that has severe damages we take into consideration the value of the home prior to the damages along with the estimated cost for renovations, including time and money. We differentiate ourselves from the insurance companies in a major way however, in respect to our motives. We are not looking to give you as little as possible; but instead provide a fair valuation of the homes fair market value.
Getting a Professional Opinion
To get a true understanding of the fair market value of your home it is recommended that you seek the assistance of a professional. Individuals in the field are continuously working with homeowners, reading market updates, and assessing home trends, which provides them with the understanding of how to value your home at a competitive price. One of the worst things an individual can do is evaluate their own home and set the expectation of that selling price. Due to an emotional connection, many homeowners value their homes above their true value.
If you are considering selling and would like a free market evaluation, we here at Gulf State Homebuyers are happy to help. We specialize in purchasing homes in the Baytown area and therefore spend our days living and breathing the local real estate economy. We purchase homes all cash and provide an easy solution for residents to close quickly. We purchase homes of all types, including those that are damaged by fire or rain, homes that are heading towards foreclosure, and even homes that have unwanted tenants living in them. To get started with your free home evaluation, contact us today.