What’s Your Home Really Worth?

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Finding the value of your home has become one of the easiest things to do with the help of the internet. The problem is when you go to different websites you receive different results. Why? Shouldn’t they all be the same? Aren’t they all using the same data? Come on and I’ll show you, How Much Is Your Home Really Worth?

Some of the most popular real estate websites have been giving inaccurate home values for years and real estate agents have felt the back lash. When a home owner asks their agent, “How much is my home worth?” and their agent states a price lower then the popular websites’ well, things can get a little messy! Or when the home buyer asks, “How much should I offer?” and their agent tells them a higher price then the popular website does, yup, it can get a little messy! You can’t blame the home owner or buyer, how are they supposed to know the difference?

This is where a realtor’s expertise, knowledge and education comes in. Your agent knows the most important factor in selling your home is pricing it correctly right from the start. If not it can stay on the market far longer than it should and the longer a home is on the market the less likely it will receive a full price offer. So getting it right the first time is imperative!

Most automated home value websites use a “proprietary automated valuation model.” Taking data from numerous places such as individual brokerage’s real estate websites, direct input from consumers or from the county and tax assessor’s records. Most of the automated value websites do not get their feed from their local Multiple Listing Service. Therefore the information available to them can be inaccurate or can be incorrect all together! Having a direct feed from the Multiple Listing Service guarantees your agent is receiving the most accurate and up to date data available.

Zillow’s CEO, Spencer Rascoff, says Zestimates are “a good starting point” but that nationwide Zestimates have a “median error rate” of about 8%!

When looking into how much is your home really worth an automated system doesn’t have the ability to take in key factors that influence a home’s value. They do not take into account and cannot take into account a wide variety of factors which are crucial to calculating an accurate list price. These factors include upgrades or deferred maintenance which is an absolute must when pricing a home. They also don’t take into account the current market trend, year built, layout of the home, architectural style, poorly located rooms or tiny rooms, and location of the home (is it located next to a busy street or a golf course?).

In order for your realtor to find out how much your home is really worth they take into account numerous factors such as:

Recently sold homes, usually going back three months within your tract with similar square footage and upgrades.

They look for any deferred maintenance from a leaky roof to the sprinkler system. It all adds up!

The location of the home, after all it’s all about the location in real estate!

The current active listings on the market, you need to know what your competition is!

The current market trend – A seller’s market or a buyer’s market.

The lay out of the home. Is there just one bathroom in a three bedroom home?

The neighborhood. Is it in an up and coming area or in a not so desirable area?

The type of buyer who would be interested in the home. Is it for a very specific type of buyer or would it appeal to a number of different buyers?

Permitted rooms or non permitted rooms. If the room isn’t permitted than you can’t use it in your calculation of square footage.

The motivation of the parties involved is also a huge determining factor in price.

As well as many additional factors as well. You can see how an automated generated list price cannot be as accurate as your agents due diligence when it comes to pricing your home.

The best piece of advice you can take away from this…take all the automated estimates as a starting point and with a grain of salt. For an accurate listing price… call your agent.

Thank you for reading my post on, “What Is Your Home Really Worth?” If there is anything I can do to help you with any of your questions, concerns, wants or needs regarding real estate please let me know. I’m here to help!

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2 Comments
  1. Profile photo of Chuck Harris
    Chuck Harris 1 year ago

    So many homeowners think that the value of their home is the value given by Zillow. Thanks for pointing out the numerous reasons that a real estate agent is invaluable to a homeowner when trying to determine the real value of their home. There really isn’t a substitute for a local real estate agent with knowledge of the neighborhood.

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