When selling your house in northeast Ohio it’s important to understand home values. Any real estate transaction is filled with specialized terminology and plenty of hoops through which to jump. To prepare you for your next home sale, let’s take a close look at appraised value and market value, and what do these numbers mean when selling your house in Broadview Heights.
What Is Appraised Value?
Whenever a home is up for sale and a mortgage lender is involved on behalf of the buyer, the lender is almost certain to require an appraisal of the property.
An appraisal is done by a third-party agency to carefully calculate the believed value of the home. This number then gives the lender a better idea of whether the proposed loan is a reasonable risk to approve, or if it should be denied.
A case where a denial may happen is if the buyer and seller agreed upon a sale price that was vastly larger than the appraised value. In this example, the lender will probably deny the loan because it would leave them losing money on the property in the unlikely event that the lender needed to foreclose and take ownership of the property. The lender would then try to quickly sell the property to a new owner in an attempt to recoup any losses from their loan to the previous owner, on which they foreclosed.
In the pursuit of figuring out if the loan would be safe and therefore profitable, the appraisal value is calculated and factored into the buyer’s application.
What Is Market Value?
Say that, in the course of selling your house in Broadview Heights, you went above and beyond by having inspections and an appraisal done prior to listing.
The resulting appraised value is the minimum you should expect to get for your home, right? Not really.
Appraised value can surely help inform your decision on where to price your home, but the biggest piece of the market value equation can be a bit more complicated to quantify: an individual human being’s personal perspective of your property.
The human beings we are talking about here are your potential buyers. Appraised value is put together based on a few big data points, including the condition of the home, the layout and makeup on the home, and the closing sale prices of similar homes in your area over the last few years.
However, the market value of your property does consider these same points while adding in how attractive and welcoming the property is. The easiest way to think of market value is the actual amount of money someone is willing to pay to purchase your property in its current state.
What Do I Do Now?
With all of this information now laid out before you, what’s the next step?
If you’re finding yourself in a situation where you are unsure of how to price your property, or feel that the market value of your home is too low compared to the appraised value, this is a great opportunity to lean on a qualified and experienced real estate professional.
Your local realtors keep their eyes on the market, know how to take advantage of growing real estate trends, and come equipped with a bevy of professional contacts to make your life easier when selling your home.
If you are not currently working with an agent, shop around for the right one for you. If you are already working with an agent, discuss with them ways to improve both the appraised and market values of your home to get the most from your home sale.
Professional Guidance When Selling Your House in Broadview Heights
Getting the most out of your home sale is important, especially if you need to turn around and purchase a new property.