How To Learn Your Home's Market Value

If you've been thinking about selling your home, there are many decisions you'll need to make. Choosing the right listing price is one of the most important. To do this, you'll need to understand the current market conditions and the value of your home. 

Luckily, finding this information isn't as complicated as you might think. Start with these five tips.

Use Free Online Valuation Tools

As with most things in life, you can begin your home value research online. There are many free online valuation tools available, and you can find them by simply typing "How much is my home worth?" into any search engine. 

These tools, which are technically called an "automated valuation model" (AVM), use public records and mathematical modeling to predict your home's value. Unfortunately, these resources aren't always super accurate. However, they'll give you a good starting point. 

Use the House Price Index Calculator 

If you're still in the early stage of your research but you want more accuracy, take a look at the Federal Housing Financing Agency's House Price Index (HPI) calculator. This tool uses a "repeat sales method," which tracks the change in a home's value from one sale to the next. It then uses this information to predict the next value. 

There are some drawbacks, though. The HPI calculator only looks at conforming home mortgages and doesn't make seasonal or inflation adjustments. Still, it's a simple way to see how much your home may have appreciated over time. 

Request a Comparative Market Analysis

When you're ready to take a deeper dive, it's time to reach out to a real estate agent and request a comparative market analysis (CMA). While this report isn't as detailed as a professional appraisal, it will provide you with an expert's estimate of your home's value. 

Many agents will provide a CMA for free or for a nominal cost. However, be aware that there's a good chance they'll do so in the hopes of becoming your selling agent. 

Hire a Professional Appraiser

If a buyer wants to purchase your home using borrowed money, the lender will require a professional appraisal. As a seller, it's sometimes a good idea to hire your own appraiser before you list your home. Not only will this help you set the right asking price, but it will also help ensure you don't end up with any unpleasant surprises. 

Evaluate Comparable Properties 

When determining your home's value, one of the things all of the sources above have in common is that they look at the recent sales of comparable properties (also called "comps"). It's also possible to evaluate comps on your own. However, this is the most complicated option, and it's critical to make sure you're actually doing an "apples to apples" comparison. When looking for comparable properties, make sure they're very similar in terms of location, size, condition, and upgrades.

To do a fair evaluation, you'll need at least three comps. It's unlikely you'll find enough homes that are exactly like yours, so you'll need to make adjustments for differences. For example, if a comp had one more bedroom than yours, it's likely your home is worth a bit less. Making adjustments correctly requires knowledge of market conditions. This quite difficult if you don't have industry experience.

Since pricing your home appropriately is so critical to the selling process, we recommend working with an experienced real estate agent who can help you determine your home's value within a reliable range.

• Simple Daily Habits to Maintain a Cleaner Home
• Don't Let Winter Win: How to Freeze-Proof Your Garage
• How to Extend the Life of Your Water Heater
• Winterproofing Windows and Doors: A Guide to Keeping the Cold Out
• How to Future-Proof Your Home for Changing Needs
• Home Happiness 101: Small Upgrades That Can Make Every Day Feel Better
• Fall Cleaning Tips For Decluttering Before the Holidays
• How to Create a Cozy Fall Retreat in Your Backyard
• Why Fall is Prime Time for Window Replacement
• Tips for Transitioning Your Closet From Summer to Fall

• Why September Is the Best Month to Paint Your Home's Exterior
• End-of-Summer Pool Closing Tips

• What to Know About Using Gifted Funds for a Down Payment
• What to Know About Using Gifted Funds for a Down Payment
• How to Research Crime and Safety
• What Buyers Need to Know About Home Warranties
• Browsing for Homes Online? Follow These Shopping Tips
• How to Look Past Bad Staging
• What Happens If Interest Rates Change After You Buy?
• How to Compare Two Homes You Love
• Post-Holiday Finances: How to Reset Your Budget for Home Buying
• New Year, New Home: How to Set Smart Home-Buying Goals for the Year Ahead

• Looking Beyond Closets: How to Evaluate a Home's Storage Potential
• Time-Off Tips: Using Your Holiday Break for Real Estate Decision-Making

• What Buyers Notice First in Listing Photos
• How Spring Sellers Can Enter The Market With Confidence
• Tax Considerations Home Sellers Should Know About
• The One-Room-at-a-Time Spring Prep Strategy
• What's the Difference Between Listing a Home and Marketing It?
• How to Respond to Buyer Feedback Without Panicking
• Transparency Builds Trust: Why Honesty Sells Homes Faster
• Winter Selling Myths That Shouldn't Keep You From Listing
• The Value of Local Market Knowledge When Selling Your Home
• Selling in Snowy Conditions: Safety, Access, and Presentation Tips

• Making Your Home Smell Like Home: Winter Scents That Attract Buyers
• Handling Relocation Buyers During the Holidays