Market Value = house specific, current, based mainly on aesthetic appeal (new kitchen, wonderful yard, location, etc.)
Assessed Value = neighborhood average, historical (old), based mainly on exterior mechanics (size/ age).
Now that we have that established, lets proceed.
Whether helping a seller set a price or helping a buyer write an offer, they want to know my opinion. “So how much it the place ‘worth’?”
- A seller always picks a number that is highest – e.g.: ‘Well such n such says my house is worth $bla bla bla’.
- A buyer always picks the lowest number (surprise) – e.g. ‘Well this says its only worth $yada yada.’
Opinion? Not so much, I prefer to provide information. With me & numbers I’ll give you various methods I use & crunch the numbers on YourSpace – YOU choose the value. My accounting & finance degree and nurture of broker fathers background with an economics masters has dictated this style as my preferred approach.
Back to definitions:
- Assessed =
- neighborhood average,
- historical (old),
- based mainly on exterior mechanics (size/ age).
- The assessor used a complicated ‘multiple regression analysis’ to take all properties with in the ‘taxing unit’ and give approximate values to the ‘components’ of homes.
- i.e.: bathroom #1 is worth $2000, bath #2 an extra $600, #3…$250, etc.
- 1000 s/f = $XX per s/f, 1001-1500 is worth $X per s/f
- New roof = $XX less $X for each year its been there
- Market =
- house specific,
- based mainly on aesthetic appeal (new kitchen, wonderful yard, location, etc.)
- , ‘Zillow’ = a computer model spits out this often ‘train wreck’ of a combination of #1 &2.
- I’ve seen Zillow ‘values’ of $165000 for a home listed at $80k. I’ve seen the opposite, which can confuse a buyer obviously.
- After all, ‘Zillow’ never walked the neighboor hood, or smelled the basement, or saw the standing water in the spring time.
- Taxable = as it says. Forget using this number as a value. Your only concern here is if its too high, then you need to protest it.
- Bigger Picture RealtyNetWorth Value ? = Have you every booked a flight online? Notice it says ‘save money by being flexible with travel dates’, yes? If your timing, tax situation, stage of life, & non-financial intangibles aren’t being considered, you may well need a better qualified ‘resource(s)’.
So whats a wise person to do?
The model I use for buyers and sellers is a spreadsheet approach that uses input from both the assessment – which considers the interaction of house basics, and current market sell prices from ‘as close as possible like-kind’ homes. To use one aspect without the other is a huge absence of a critical treasure of data.