Selling a home is always stressful. But it can be made even more stressful when it’s hard to find out what your home value. Googling “what is my house is worth?” may seem like an easy prospect, but sadly, Automated Valuation Model, or “AVM” websites often have misleading or incorrect information.
AVM websites take into account the average value of homes in that area. Using an average, without regarding the location of the home and its physical condition, these websites can be off by even $50,000. The best bet for finding the true value of your home is to ask an appraiser or experienced Realtor.
Limitations of a “CMA”
An typical home valuation takes into account a lot of factors, including size, layout, location, and condition of the home, as well as upgrades, and the square footage of the lot. Next, a Realtor or appraiser will look at homes that are comparable to yours and adjust for any differences (since no two homes are identical) to determine market value. This is the method used in the Comparative Market Analysis (CMA) relied on by many agents.
The weakness of the CMA method is that it “sets a price for tomorrow using data from yesterday.” In other words, if a market is climbing or descending, past value data will be wrong a month or so later. This is why I look at market trends, in addition to comparable sales, to nail down the best listing price. Monitoring shifts in average sales price, days on market, and absorption rates, helps me stay ahead of the market.
Getting Ahead of the Trend
Using trends to anticipate how much a house will sell for in the future allows me to recommend a strategy that produces a swift sale at the best possible price. In the second quarter of 2018 the median price of single-family homes in Salt Lake County reached $327,800, up from $300,000 the time last year, which is 9.3%. In areas such as Sugar House and the Avenues, home value shifts are happening even faster. A value set today, will be wrong in 30 days, and could cost you thousands (at least $2,000 using the numbers above).
A Better AVM
I have a free tool that can help you get a quick estimation of the value of your Salt Lake City home. It also will tell you how much home values have increased in your area. It’s an AVM, but it’s better than most. When entering Salt Lake City addresses, it sometimes suggests a slightly different variation (thank you Google Maps…grrrr!). In that case, feel free to email me and I’ll gladly pull it manually.
Let Me Help
Additionally, feel free to contact me directly (801.893.2519) for a home value check-up including an inside look at market trends. It’s a free way to keep up with one of your most valuable assets. It is a service I have always provided my friends and clients.
p.s. Did you know there are inexpensive and fast ways to boost your home values and put thousands in your pocket? If you are thinking of selling, read this post first! Eight Tips for Adding Instant Curb Appeal
