As you’re browsing homes in your market, it’s important to look beyond the home’s listing price. Sellers don’t always list their homes according to market value, so buyers should do their due diligence to see if they’re getting a good deal on a home or paying too much for it.
Here’s what goes into determining a home’s value and how you can use free online resources to compare that value to the listing price.
What Factors Contribute to a Home’s Value?
When you’re evaluating a home, things like its previous sales history, the neighborhood and location, and home features play an important role. Desirable neighborhoods and prime locations will drive up a home’s value, based on supply and demand principles.
Real estate agents and appraisers look at a home’s sale history as a benchmark. For example, if a home has been sold in the $150s three different times, then valuation will probably start in this range and adjust based on changes to the property.
The current state of the market will also affect a home’s value. When demand is high, home prices increase to match the demand (also called a seller’s market). When the market is slow, home prices may sink a little to attract buyers.
A home’s condition is factored into its value. Homes that are new or well-maintained will not need as much maintenance, which means they will probably earn a higher selling price. Homes in obvious need of repairs may not sell for as much as a well-maintained home similar in size or location.
Real estate agents work with appraisers regularly to help determine a home’s value. However, they are not official appraisers and can only give guidance on pricing versus an official statement. Even though appraisal costs can be as much as $500, most buyers consider it money well spent.
5 Ways to Get a Free Home Appraisal Online
While it may make financial sense to hire a professional appraiser, you can use an online tool to give you a ballpark figure on what a home might be worth. Consider the following free online appraisal tools and value estimators for buyers:
For Sale by Owner
This listing site helps you find relevant data on properties listed For Sale By Owner.
Their Pricing Scout tool is simple to use: just input the home’s address into the field and view the results. You’ll see information on the home itself, such as current value, last sale price and date, and a range of potential values. Plus, you’ll also see what other homes in that area have sold for.
But while all of this information can be helpful, the tool doesn’t put any of it into context. You can’t see the condition of the others homes that have been sold or how they stack up to the home you’re thinking of buying. There’s a lot of gray area here that should be approached with caution.
Zillow has become one of the biggest real estate websites for data. Zillow collects data on properties across the country, including home value estimates. But even Zillow admits that its Zestimates are not meant to replace a formal appraisal, but offer a good starting point for buyers and sellers.
Chase Mortgage Services
Chase is a major mortgage lender throughout the country, so it’s not much of a surprise they use the data they collect to create home value estimates. They calculate these values based on the millions of home records in their databases. One cool feature is the ability to add potential home projects to see how they will impact your home’s value.
Unlike most real estate sites that offer an appraisal tool, Eppraisal’s core focus is on home values. It’s also easy to use: type in the street address, city, and state and see how different sources rate your home’s value.
You’ll also see other local market data, like recently sold homes in the area, public record data, and local school information.
This tool is a little more credible than others, given it includes data from more than one source. But it still doesn’t put its content into context regarding condition, features, and the local market at large.
Realtor.com is one of the biggest names in real estate. Their online home value tool is free to use and shows value fluctuations of a home.
However, the home value estimator is just a small part of the available home data, and they put little emphasis on it. This website is a much better resource for general markets rather than specific homes.
Clever Offers an Effective Alternative for Estimating Home Values
Getting an online value estimate can be a helpful jumping off point, but these tools have their limits and won’t always be accurate. As a buyer, it’s important that you understand a home’s actual value according to the market, not the seller, because it could affect a lender’s decision on whether to grant you a mortgage.
Clever Partner Agents are top-rated real estate agents in their markets that have local knowledge and experience and can advise buyers about what a fair offer is for a house. They can also help you partner with a reputable appraisal company so you can feel confident about the outcome.
And, in select states, you may qualify for a $1,000 Home Buyer Rebate that will more than cover the cost of a formal appraisal.
Connect with Clever today for a no-obligation consultation and let us introduce you to a skilled buyer’s agent in your area!