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Ask Your Realtor - What is Fair Market Value and how is it calculated?

By
Real Estate Agent with RE/MAX Jazz Inc., Brokerage

What is "Fair Market Value" and how is it determined?

When selling your home, you’re bound to hear some terms and phrases that are unfamiliar to you. One of these is “Fair Market Value”. Well, just what is Fair Market Value?

The technical definition is “the highest price in terms of money which a property will bring to a willing Seller if exposed for sale on the open market allowing time to find a willing Buyer, buying with the knowledge of all the uses to which it is adapted and for which it is legally capable of being used, and with neither party acting under necessity, compulsion or peculiar and special circumstances.”.

Determining Fair Market Value is one of the jobs of your Realtor, and something I take very seriously. Establishing the correct Fair Market Value can determine if your house sells quickly, or languishes and becomes stale on the market.

Determining a home’s Fair Market Value can be a complicated process, whether you’re listing a home for sale or submitting an offer to purchase. When selling, you’ll need to ensure your home is competitive and priced attractively which maximizing your bottom line. When buying, you’ll want your offer to be accepted without feeling like you’ve overpaid.

Simply comparing the listing to other homes in the area is not the only and best way to establish it’s fair market value. Other factors such as market trends, conditions, assessing the homes attributes and providing objectivity are all integral parts of correctly determining the fair market value of a given property.

While a home may appear similar to another from the outside, there are many factors that go into pricing a home that may not be easily seen by the untrained eye. Some of these could be:

- interior finishes
- age & condition of roof, electrical panel, heating system, etc
- lot size and premiums
- exact location - being a few houses one way or the other on a street could mean a different school district!
- items included with the sale (ie appliances, hot tub, etc)

A Realtor can help with the valuation process by bringing knowledge, experience and objectivity to the process.

 

The Buying and Selling process can be an emotional experience, and it can be difficult to hear that a home’s Fair Market Value may not be in line with your expectations. A Realtor can objectively evaluate a home to help ensure that a home’s purchase or sale reflects Fair Market Value.

Market Evaluations, where I determine what Fair Market Value for your property is, are always free.  Call or email me to schedule a time for us to get together and I will be happy to provide you with a complimentary evaluation! My direct office line is 905-433-2579 or I can be reached via email at dianna@dmandzuk.ca!

 

I look forward to hearing from you...

Dianna

 

 

Posted by

Dianna Mandzuk

Sales Representative

 

RE/Max Circle of Legends Award Recipient

(One of RE/Max's Highest level of Performance Achievement Awards)

Certified Luxury Home Marketing Specialist

Canadian Staging Professional

30 years serving your real estate needs!

RE/Max Jazz Inc., Brokerage

Each Office Independently Owned & Operated

Direct 905-433-2579

Office 905-728-1600

www.dmandzuk.ca

dianna@dmandzuk.ca

 

P.S. We're never too busy for your referrals!

Comments (1)

Mark Loewenberg
KW of the Palm Beaches - Palm Beach Gardens, FL
KW 561-214-0370

good list of ideas for folks to learn how to determine Fair Market Value for a home, very difficult task

Mar 14, 2013 11:58 AM