If you own property, you’ve probably asked this question to yourself at one point or another: “What is my property worth?” Most property owners know what they paid for their property and how much their monthly mortgage payment is but not everyone knows what the current value of their property is. Why is it important that I know what is my property worth? How can I know what is my property worth?
Here are some of the biggest reasons why knowing your home’s value is so important.
1. Selling your property
Your investment property is your biggest financial asset. That is why it is important that you get the highest selling price you can possibly get. When I know what is my property worth, I can confidently establish a selling price. When real estate investors know the value of their property and key market trends, they can easily determine whether or not to place it on the market for sale.
2. Upgrading and repairs
As a property owner, when I know what my property is worth I can easily decide if upgrades and home repairs are a smart idea. Before you make any repairs to your property, you need to know whether or not these expenses will pay off in the long run. It’s good to make upgrades and repairs to your property only when you know that they will increase the value of your property and selling price.
Generally, repairs such as remolding the kitchen or bathrooms or upgrading the roof have the most financial impact. If you’re aiming to generate a high return on investment, then make sure you only make upgrades that are in line with the value of properties in your area. The last thing you want is to upgrade your property and make it so luxurious and find out that none of the houses in your neighborhood match yours. You could be potentially hurting yourself if you don’t strategically think renovations through.
3. Property tax
Your property taxes are directly related to the value of your property. If for any reason, I felt like my city evaluated my property at too high a value, I can appeal my property tax bill by using my knowledge on what my property is worth currently.
Now that you understand the importance of knowing your home value, it’s time to find out the “HOW.”
How can I find out what my property is worth?
Use online property valuation tools
If you just type “What is my property worth” into Google, you will get hundreds of home value estimators within seconds. The various property valuation tools are found on different real estate investing websites. These tools are used by property owners nationwide to estimate the value of their property. Here are some websites that make the task of finding your home’s value quick and easy.
Zillow is one of the biggest and most popular real estate investing websites for finding your property’s worth. Zillow’s website layout is simple and easy to use. You are able to find out your property’s estimated value using Zillow’s Zestimate.
Similar to Zillow, Truila.com also helps property owners find their property’s estimated value. When you reach Trulia’s website, you simply enter in your address and learn how much your home might be worth. Trulia offers information like the average listing price for similar homes in your area along with standard details on your property (square footage and bed/bath information).
Another real estate investing website that has become popular among investors and property owners is Redfin. Redfin helps those asking themselves “What is my property worth.” You can enter a bunch of details about your property and learn about the local neighborhood and how much property taxes cost each year. Additionally, Redfin uses the most accurate data from the Multiple Listing Service (MLS) to calculate your property’s current market value.
Realtor.com is a real estate investing website that is free for anyone to use. By simply entering your property’s address, you can learn an array of information including your property’s estimated price. This tool is also great for learning about similar properties in your neighborhood and how much they might be worth it.
Hire a professional appraiser
A real estate appraiser is someone whose job is to estimate the value of properties. As most homeowners determine their property’s worth through an appraisal, you can easily hire a professional appraiser anytime.
Real estate appraisers evaluate many things, some of which include the following:
The market: The region, city, and neighborhood in which a home is located.
The property: Characteristics of the house, including improvements and the land it sits on.
Comparable properties: Sales, listings, vacancies, cost, depreciation, and other factors for similar houses in the same market.
All of this information is combined to give the final value for the property and the appraiser presents the information in an official report.
Evaluate real estate comps (comparable properties)
A very effective way to find the value of your property is through real estate comps. More than half of U.S homeowners estimate their home’s value by looking at comparable properties. Like I previously mentioned, Mashvisor has the best tools for comparative market analysis which allows you to easily compare properties in your area to determine your property’s market value.
The bottom line
Knowing what is my property worth is very important. As a property owner, it is your responsibility to always keep yourself up-to-date on your property’s value. There are property valuation tools all over the internet. Be sure to check out Mashvisor for the best property valuation tools and techniques.