How Much is Your Home Worth?
- Instant property valuation
- Expert advice
- Sell for more
What's Your Property Worth?
Your home is likely your most significant asset, and knowing its true value is valuable knowledge that empowers you to make smart decisions about your financial future. It’s good practice to stay informed about how much equity you have in your home and how much you may be able to borrow against it, or what price you can expect when you decide to sell.
For the most precise and actionable valuation, we encourage you to take the next step. Reach out to discuss a customized Comparative Market Analysis (CMA) or a full professional appraisal. We are here to ensure you have the most reliable data to plan your next smart move, whether you’re refinancing, renovating, or preparing to list your property.
What is a Home Valuation?
A home valuation determines the current market value of a residential property and is crucial for all real estate transactions, acting as a safeguard for both buyers and lenders by preventing excessive borrowing and financial losses. When you secure a mortgage, the home itself serves as collateral; this means that if the borrower defaults on the loan payments, the lender has the right to sell the property to recover the funds owed. Therefore, a thorough and accurate home valuation is essential because it directly safeguards the lender’s ability to recover costs if the mortgage is not fully repaid, ensuring stability in the lending process.
How is the Valuation of My Home Calculated?
A home valuation determines the current market value of a residential property and is crucial for all real estate transactions, acting as a safeguard for both buyers and lenders by preventing excessive borrowing and financial losses. When you secure a mortgage, the home itself serves as collateral; this means that if the borrower defaults on the loan payments, the lender has the right to sell the property to recover the funds owed. Therefore, a thorough and accurate home valuation is essential because it directly safeguards the lender’s ability to recover costs if the mortgage is not fully repaid, ensuring stability in the lending process.
How Accurate is the Online Home Valuation?
Online home valuations provide a good starting point and offer a general estimate of your property’s worth. However, these automated tools often miss crucial details that impact your home’s actual market value; they may not factor in recent renovations, unique features, historical value, architectural significance, and subjective market perception. For the most accurate assessment and a valuation that accounts for these specific details, consider scheduling a professional in-person appraisal.
Find Your Perfect Home
How Is a Valuation Performed?
Two Accurate Ways to Perform Home Valuations
Market Analysis
Comparative Market Analysis (CMA): Valuing Your Home with Local Data
A Comparative Market Analysis (CMA) is a tool real estate agents use to value a home by evaluating similar properties, known as “comps,” that have recently sold in the same local area. Agents typically identify three recently sold homes that are as similar in features and as close in proximity to the subject home as possible. Each comparable sale is then analyzed to pinpoint specific differences between it and the home being valued. Once these differences are priced out, the price of each comp is adjusted to determine what it would cost if it were identical to the home being valued and sold in the current market, providing a highly precise estimate of the subject home’s worth.
The Professional Appraisal: An Unbiased Valuation for Lenders
An appraisal is an unbiased, professional valuation of a home, typically used by mortgage companies for both home purchases and refinances. A lender usually orders the home appraisal, and the cost, sometimes up to $500, is paid by the homeowner. The appraiser conducts a complete visual inspection of the interior and exterior of the home, while also taking into consideration recent sales of similar properties and current market trends. The appraiser then compiles a detailed report on the home, which includes an exterior building sketch, a street map showing the home and comparable sales, photos of the home and street, an explanation of how the square footage was calculated, and any other relevant information.
Appraisals
Why Is a Valuation Important?
Situations When a Home Valuation May Be Necessary
Refinancing
Lenders base the amount of their loans on the value of your property, typically allowing you to borrow a maximum of 75% to 96.5% against your property’s value through what is known as the Loan-to-Value (LTV) ratio. Knowing what your home is worth allows lenders to accurately calculate your equity in the home—the difference between the home’s market value and the amount you still owe. The more equity you have, the better terms and lower interest rates you will typically receive on a refinance or home equity product.
If you’re doing home improvement projects to increase the resale value, you must be careful not to price your home out of the market. If your property is already priced on the high-end for your neighborhood, making too many improvements could make it more difficult to sell, as potential buyers may not be able or willing to pay for upgrades that exceed the neighborhood ceiling. When you get a home valuation, you can see precisely how your home compares with others in the immediate neighborhood, and this valuable data should guide your home improvement decisions, ensuring your investments offer the best return.
Home Improvements
Qualifying For Credit
If you want to borrow cash against your home, getting a Home Equity Line of Credit (HELOC) could be a good option. To qualify for a HELOC, you must have a certain level of equity in your home, with most lenders requiring you to have at least 20% equity. Getting a home valuation will help you determine if you meet this equity requirement and will be the official tool used by the lender to make a final decision on your loan amount.
Though it’s not a necessity, simply knowing the value of your home is good information to have. This knowledge is essential for effective financial planning and allows you to deal with unforeseen circumstances, such as needing extra money or facing a quick relocation. Knowing how much equity you have in your home, and how much you may be able to borrow against it or sell it for, will empower you to respond proactively to any financial curveballs that life throws at you.
Planning