How Much is My House Worth?

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With the housing market in so much turmoil, more and more people are wondering how much their houses might be worth these days. Home equity is the market value of your home, and it increases as you make payments against the mortgage and as the property value increases. 

If you are considering selling your home, or simply want to know its value, these following methods can help you determine how much your home is worth.

Free Online Estimates

There are many websites that offer free appraisals to homeowners. It's important to remember that these websites are simply making informed estimates based on publicly available information such as records of taxes in the area, or what other houses and properties in your neighborhood are selling for. 

In states where it's legal, you can often do a search in your area for what houses are selling for on the real estate market. If photos are available you can easily see what the physical state and appearance of the home is to get a better idea of whether or not it the price accurately reflects its condition.  

While sites like Eppraisal can be helpful in getting a starting idea of what the market is like in your region, this is not a definite or entirely accurate way to get a financial reading of your own home. Because these sites simply offer estimates, better to view this step as research.

Fee-Based Online Appraisals

Not to be confused with the online estimates, an appraisal offers a property valuation report that you can usually download from the website for a small fee. 

Sites like Electronic Appraiser also use publicly available information to determine the property's worth, using a comparative approach that identifies features such as bedrooms and baths, recent sales of other properties in the area, local census information regarding crime and other statistics in the area, whether or not schools are located nearby, and if the home contains fireplaces. 

Compared to a professional appraiser, which can cost anywhere from 300 to 500 dollars for a single visit, the electronic appraisals only cost around 30 dollars and can save you time looking up records yourself. 

However, it should be noted again that these are not definite prices as they are factored according to other data that may or may not reflect your home's current circumstances. Nonetheless, they will usually give you a better idea of the price range to expect if you plan on selling your home.

Real Estate Comparative Market Analyses

Comparative market analyses are reports that are prepared by real estate professionals in your area. A bit more in-depth than an online report based on estimates and public information, a real estate professional is usually familiar with your area and can give you more specific details about what other properties have sold for in recent months. 

Keep in mind, however, that comparative market analyses are only possible if you plan on selling your home through a broker or real estate agency. If you want to secure a loan or line of credit through a bank a comparative market analysis cannot help you with this, as most banks don't accept this as valid proof of the home's financial value. 

Another important detail to note is that most real estate agents will charge you commission for their time and information. Some states regulate this but in general if you don't plan to list with this agent plan to pay for their effort and information.

Professional Home Appraisals

You've fallen in love with the home of your dreams and want to apply for a loan from the bank to help with the purchase. If this sums up your situation, then plan on hiring a professional home appraiser to give you the most precise, detailed report of your dream home's exact worth. 

If you are selling your home and have made large-scale improvements such as finishing the basement that will increase the value of your home, this is also something to consider, as it will help you to sell your home at a more accurate price regardless of other selling prices listed in the area. 

You can expect an appraiser to fully detail all the improvements and distinguishing features of your home such as measuring its square footage. When choosing a professional appraiser make sure they have a state certification in addition to a real estate license, at least three years experience, and membership in a professional organization such as the Appraisal Institute.