What is fair market value of a property, anyway?
Consumers are prone to looking at tax value from public records, Zillow, Trulia or they take their appraisal from their loan or refi x years ago. These are all... wrong.
Those "market values" are good for the purpose intended: (a) estimates (b) at the exact time they are performed (c) to satisfy a different agenda.
But none of those are the definition of fair market value, technically.
Fair market value is what a willing seller will sell for and a willing buyer will buy for without any undue pressure. Period.
How do we, as pros, determine that value? Easy. I mean, it takes time, as well as our know-how to do, but it is easy to define. We look at recent sales just like yours. If recent sales are not exactly like yours, then we look at yours and compare it to the next. With an experienced Realtor's knowledge, like mine, fairly accurate values can be given to specific features and amenities. What materials cost and what today's consumers are demanding are both contributors to what market value is. It is really easy to assess in heavily populated areas, like most of the suburban towns around DFW. It is a little harder in more rural areas or more specialized homes with few like properties sold nearby - the adjustments for all the differences can be more challenging to calculate, consumer behavior harder to predict.
Short sales, foreclosures, and divorces, as examples, tend to be more pressured, fire-sale type situations that are a little different than regular, undue pressure, owner-occupied sales. The stark different types of sales are not really comparable most of the time. Sometimes bargain houses are in nice condition or offer a good lot, but usually the as-is nature of a foreclosure, the long awaited bank terms of a short sale or the condition or half-filled showmanship of a divorcing household can leave the bottom dollar a little more bottom dollar than the good looker next door. The point is value is what a willing seller will sell for and a willing buyer will buy for and a lot of things go into consideration when providing an estimate of what this will be, but it's easy to do for a pro like me. Want to know a secret? I tend to play a little game with it in my files... What did I say it would go for? What did we get as offers? How on the spot was I? I'm pretty good!
Value is not: Zillow, uncomparable sales or currently "active for sale" list prices. Sold houses count most. They are proven successful sales. "Active on the market for sale today" is sort of a dreamy state that doesn't count as much... yet. Value is not often found in what your friends say. It is not what you need out of the house. It is not your payoff. It's not going to help to consider any of that when determining the value of your own home.
Those things matter when you go to pay bills or balance your checkbook. The other house fliers in the neighborhood give you something to do while you're walking Fido. The real value lies in the recent sales that compare easily to yours.
Finding a trusted Realtor like me to give you that assessment is your key to selling success. Call me about it anytime.