Getting Your Value
If you found this guide, you probably are thinking of selling your home.
Whether you are selling next week, next year or are just curious about your properties value, read on.
I will tell you how to quickly and easily determine your home value the right way.
If you want to get the most information about selling your home, check out my 2020 house selling guide.
Tax Assessed Value vs. Market Value
Tax Assessed Value
Every year, your jurisdiction will send you an assessment of your property’s value. You may think that this is a pretty good reflection of your market value, but often it is not.
This assessed value may be close to market value in some areas, but it is generally not in Northern VA.
If home values are rising, the tax assessed value is often lower than what you will get when selling your house.
The purpose of the assessment is for the government to get a basis to charge you property taxes every year.
They will charge a percentage of their assessed value. So it is not a bad thing to have your assessed value on the low side.
Market value is represents how much your home would sell for to a buyer. This is what you are trying to figure out by reading this guide.
As I mentioned above, the market value is very often higher than the assessed value if you are selling in Northern VA.
There are a couple exceptions.
First, If the real estate market is in a recession and values are quickly going down, you may have to go below assessment to find a buyer for your home.
This is a “buyers market”. A buyer’s market is when there are not enough buyers to meet the supply of listings. Simple supply and demand says prices will fall.
Second, if your home is in very poor condition, disrepair or there is another material factor affecting your home’s value, the price may be below the assessed value.
So to sum up, market value is what a buyer will pay in the current market. Tax assessed value is used by your governing body to charge a percentage toward property tax.
We are looking for market value. Here is how to find it.
Using a Professional
The most efficient way to find out your home’s value is to call in a professional. The best real estate pros have valued 1000s of homes.
A good one will give you a very close idea of what the market will bring you for your home.
Real Estate Agent
A real estate agent is a great option, because most will give you a home valuation for free.
Why would I give a home valuation and market analysis for free? I give my knowledge away with the hope to work with you when the time comes to sell. Even if that is a year or more in the future.
Known as a “comparative market analysis” (CMA) a good report will tell you the overall conditions of the market, market conditions of your town and neighborhood and identify the closest comparable homes that have sold.
Try not to influence the final figure if you can help it. If an agent’s report seems to good to be true, it may be worth getting a second opinion.
A good agent will be able to show you how they arrived at their figure clearly and concisely.
Real Estate Appraiser
An appraiser is a licensed professional whose only job is to give third party, unbiased opinions of home values.
They will provide you with an appraisal report.
They take 3-5 comparable sales and do a statistical analysis to come up with a number for their opinion on your houses market value.
Chances are, when you sell your property you will have an appraisal done by the buyer as a requirement of getting their loan.
But you can also contact an appraiser to get you a market value estimate to help you with what you will sell for.
The only downside with an appraiser is the upfront cost and the fact that this will take some time.
They can either do a “drive-by” of your home or come into the home to see it in person.
There is usually a difference in cost between a drive by and in person, but when using a professional you will always get the most accurate number when they are physically inside your home to see.
Northern VA Home Value
If you live in the Northern VA area I can help you. Whether you are thinking of selling soon, or just wondering what your home value is, reach out and I can send you a report.
For the most accurate estimate, I will come and see your property. But I can also give a report all online if you are still just researching.
Just give me a good description of recent updates to your home and anything that makes it unique! Use the form to get started.
Automatic Home Value Estimate Sites
There are a large number of websites that will give you a quick home value estimate automatically. I even have one.
There are some other large sites that already have an estimate on your home for you and anyone else to see posted with a search of your address.
Auto Home Value Estimators Pros and Cons
These sites work by algorithms. They take public records, MLS data and a host of other information to give an AI generated value for your home.
• An instant value is, well, instant. You can get a number immediately.
• Many real estate pros do not like these valuations, claiming they are inaccurate. But I find them to actually give a good starting point of what your home is worth, depending on your type of property.
• They are improving, and often give a range. The algorithms are always being adjusted to attempt to be more accurate.
• Taxable square footage is often not total square footage. This is especially true in some jurisdictions (like Fairfax County).
• Your property condition is not taken into account. This is the biggest one. It is hard for a computer to account for condition at this time, even if you select “good condition” in a form.
• Each algorithm is different. Some are better than others at predicting various factors.
• Often there are current market conditions not accounted for. For example, in 2020 a virus caused a huge economic slowdown in the US. This would not be reflected in the estimate until there were enough data points (sales) which can take time. And the same would be true of the recovery from a dip in the market.
Finding Your Home Value Yourself Quickly and Accurately
If you are a do it yourself kind of person, this section is for you. The internet has given you the opportunity to do the research for yourself.
The first step is to find comparable sales of other homes closeby. This is what you will use to gauge your home’s value.
The Best Comparable Sales
The best comparables are as close geographically as possible to your property, as similar as possible to your property, and as recent as possible.
For some neighborhoods this is more simple than others. If you live in a townhome community, likely you will have an easier time than if you live in a neighborhood where most of the homes are custom built.
Let’s stick with the townhome example. You have an end unit, and your home was updated two years ago.
A month ago, another end unit sold that was the same model. It was updated last year. You looked through the photos and the updates were similar to what you did.
That is a great comparable. You will want to keep looking for more (3-4 is a good number) but you will probably weigh that one the most when picking a value for your property.
Larger or more updated properties in your neighborhood should only be used if you adjust your number downward from them, or if you update to that level before you sell.
Obviously, photos are key. If you cannot find comparables with photos you should reach out to a local agent to see if they have access to sold photos in their data through the MLS.
Where to Find Comparables
Starting soon, my site will also offer sold data. If they are not there yet reach out to me and I will send you comparables for your property.
If you find sold property data, the best ones will have photos of the property interior and exterior from when the home was marketed.
Your Home’s Condition
Honestly evaluating the condition of your property is crucial. It also can be difficult for some. If you live in the home, it has sentimental value.
The good news is, you can take the memories and sentiments with you. But the new buyer will not give you more money because it has memories for you.
So think like a buyer, and when comparing your home try to be objective.
If you property was last updated 10 years ago, it simply will not sell for as much as a home that was just updated a month ago.
Account for these differences.
The Real Estate Market Conditions
You also want to know the market you will be jumping into.
In a hot “sellers market” (more buyers than sellers) you can price at the top of the comps, maybe even slightly above if you have lots of new updates.
If you sell in a slower buyer’s market, you will want to price lower than the comps to get ahead of the falling values.
In a slow market, time is money because each home could be selling for a little less than the last.
This is why it is so important to know what is happening out there.
In addition to overall market conditions, you want to know how homes in your neighborhood sell.
Do they sell quickly for multiple offers? Or do homes take awhile to sell?
It is also a good idea to note if there are any other factors that affect values in different parts of the neighborhood.
For example: homes that back up to a main road consistently sell for less than similar properties farther inside of the neighborhood.
Your Home’s Value
Finding your homes value on your own can be done with some work.
To put it simply:
1. Find comparable sales as close in proximity, size and as recently sold as possible.
2. Adjust your properties value up or down to account for differences in size or features, if needed.
3. Account for overall and local market conditions.
Then, come up with a number or a small range that you think the property will sell for.
And there, you have your home value estimate.
It is harder than it sounds to know how much to adjust up and down for property features. And it often varies by neighborhood. If you need help, get in touch with me at the bottom of the page.
Listening to the Market
At the end of the day, it is the buyer who you sign a contract with who determines the value of your home. Everything else is an estimate.
When you do finally go to put your home on the market, you will know if you missed your estimate.
Other homes will get contracts with a buyer, and you will still be on the market longer than the average for your neighborhood.
You will also know if you were priced correctly because you will be the one to have a contract in the expected timeframe for the market.
You can adjust the price if needed, down or even in some cases up.
The most honest and accurate feedback you will get is from active home buyers, whether spoken or unspoken. Keep that in mind.
Homes With Few or No Comparables
You might have a very unique home. Maybe you built a new home 10 years back, in a neighborhood where everything else is 60+ years old.
Or maybe you have a rural home and there just are not that many properties around.
You could have also built a luxury custom home in a neighborhood where all the homes are different.
In these cases, you will have to go farther for comparables, both geographically and in time.
Expand your search to include the entire zip code or entire town if needed. Then go back a year and see if there is anything that is similar.
Most likely, there will be comparable sales for you somewhere at sometime. They might not be the best ones, but in the case of a very unique home you have to find what you can find.
Homes with no comparables at all at any time or place are not common in Northern VA, but they are out there.
If you have a very unique home, it is probably best to contact a professional to get a home value estimate.
I would be glad to take a look for you if you are located in Virginia.
Calculating Your Profit From Your Home Sale
Why do all this research on your home value? Because you want to know what you will walk away with at closing.
In Virginia, closing costs will vary with each seller. This is because real estate broker fees, taxes and loan obligations vary for each person.
If you add up real estate broker fees, and then tack on an 1% additional of the sales price that will give you a good estimate on the other closing costs.
After that, subtract what you owe on the property from your existing loan, any lines of credit and also any other liens against the property.
Doing calculations like these will help you arrive at what you can expect to walk away with after closing.
And this number will help you plan what is next in your life.
Are you thinking of selling in the near future? Have questions about your home value?
I am here to help. I have extensive experience helping sellers in all kinds of situations with all kinds of properties in Northern VA.
Fill out the form and let’s connect!