Talk about a tricky topic. Value is almost like a moving target in today's market. The value today may be significantly different than it was even 3 months ago. And it is anybody's guess as to whether prices have stabilized or whether they will go down further. There is even some speculation that with all the spending that the federal government is currently doing that inflation may drive prices upward some. Many of the leading indicators make it appear that prices have bottomed out at least temporarily. But since I don't have a crystal ball, I won't be one to guess if that trend will continue. Since I am not a licensed appraiser, this article will simply be based on my experiences as a licensed real estate broker including listing / selling about 70 properties and performing over 100 BPO's (broker price opinions) in Central Florida since January of 2009.
In this article I will discuss how to determine what a home's value is today. Whenever someone calls me asking me to sell their property for them, the first thing I do is start gathering information so I can try and determine the current market value that a home will sell for. Much of the home's information can actually be gleaned right off the local property appraiser's website. However because these websites can often contain inaccuracies, I like to interview the homeowner as well.
In this article the value determinations I will be describing have to do with single-family homes and condominiums using the "comparable sales" method of valuation. Vacant land, commercial buildings, and multi-family income properties are valued using very different methods that I will not be getting into today. The basic information that I want to know in order to determine value is (1) the street address; (2) the heated square footage; (3) the number of bedrooms and bathrooms; and (4) the home's amenities.
As a Realtor® the first place I go to search comparables is the local Multiple Listing Service (MLS for short). The MLS contains all the data about homes currently for sale as well as homes that have sold. However even as a non-Realtor you have access to a fabulous new website that our local Central Florida MLS has put together for anyone to use: www.MyFloridaHomesMLS.com. If you have not been on this site, you really should check it out. In my opinion, this site leaves websites like Cyberhomes and Zillow in the dust.
I will get into the nitty gritty details of how to determine valid comps in Part 2.