What is the calculation for determining my homes current value?

Question

I was told it was value last month X 0.70= current value.

So if my house was worth $300,000 last month and I multiply that by 0.70 it's current value is $210,000.

Is that correct?

Answer 1

Your best bet is a Real Estate Appraisal if you need to know your home worth for borrowing money or getting PMI dropped. A Real Estate agent can help also by finding recent properties of similar value that have been sold in surrounding areas in the last 6 months. Based on the comparables, you may need to adjust based on sq ft, bathrooms, bedrooms, functionality, age if you are looking to sell it. Your home is worth the dollar amount someone is willing to pay for it! Sometimes your lot will be worth more than your home.

Answer 2

Your math is correct. I just don't think the figures you plugged in are correct.

If you pay an appraiser to get a figure or get a Realtor to do a CMA what you get is a very good and very educated estimate. They come out and walk thru the house and compare it to homes that have sold very recently (and if you believe your value is dropping that quickly then the comparable sales shouldn't be 5 or 6 months ago, they should be much more recent).

Any adjustment that the appraiser uses or the Realtor uses or that you read about in the paper is a made up number. It has little more chance of being right than some number you pick out of a hat.

If you talk to a stock adviser, most will tell you that the worst thing you can do is try and look up your values every day. It screws up your thinking.

If there was an accurate way to look up the value on your house once a month it would drive you crazy--don't do it.

If you need to sell right now then get a very accurate estimate of value. If you think prices are dropping anywhere close to as fast as you proposed then price your home 10% cheaper than the agent suggests.

I bet the reality is not that drastic.

Answer 3

Before I go off on some sort of tangent, I'd better make sure I know what you're talking about when you say "my home's current value".

If we're talking about value for tax purposes, you should check with your county assessor's office, but in every county I know of, the assessor tries to determine what the property would actually sell for.

They tend to lag a year or two (or more) behind, and in rising markets, you could easily end up with that big a difference. In the current, rather flat market, those values will get much closer.

If you're talking about your home's current market value, that doesn't generally drop that fast, even in the worst of markets, unless there is a significant problem. Even there, simple formulas are rarely accurate. There are just too many variables.

Most Realtors will do a courtesy "Comparative Market Analysis" for you. Please be honest and tell the agent that you are doing it for information only and are not planning on listing in the immediate future. Most will be happy to provide the service anyway, just for the goodwill factor. Pick someone local, that routinely works in your market area.

If that "70%" formula was given to you by a friend, then thank them kindly and assume that they don't really have a clue. If it was given by someone trying to buy the property, then count your fingers after shaking hands, and make sure you're not missing any rings or jewelry.

Answer 4

I don't know any rule of thumb that is so easy for determining the value of real estate. You can hire an appraiser to give you a formal appraisal explaining the reason for the request. The appraiser will charge you a fee for his or her work.

Another option is to ask a real estate agent for a comparative market analysis on your subdivision and taking into consideration the features of your particular property.

But, if you just want a ball park idea a local agent can probably give you a good idea just in a phone conversation. I have been able to do that in my market -- the owners weren't too happy with the bad news!

If you try http://www.zillow.com then take into consideration that it is purely mathematical and mechanical without the benefit of someone who knows the local market to interpret the data.

Additionally you can go to the property appraisers site for your county and using your subdivision information do a search for closed sales within the past 6 months or year at most. Go through the list property by property and keep the square footage within 200 sq ft of your property. Look for amenities such as a pool etc. that will affect price.

Answer 5

Not in my neighborhood!

There are many variables in determining the value of your house but the primary basis is comparing it to other similar houses that have recently sold nearby. Check your county tax assessors office for resent sales records for this information. Or, speak to a Realtor

Answer 6

Geez, I hope not!

There isn't any calculation - it's current value is what someone would be willing to pay for it. You can have it appraised, and that will probably give you a pretty good idea what it would be worth.

Answer 7

OOOH, yuck, you selling??