Real Estate Property Value Determination in Norwalk,?CT
December 16, 2012 by cthomeconsultant
How Much Is My Home Worth in Norwalk, CT?
Raised Ranch Near Rowayton
To determine the market value of a home is a blend of art and science. ?It takes a very competent, experienced full time real estate professional who knows the local town, its neighborhoods, its school systems, its tax structure and market trends. ?Keep in mind that a local Realtor will always give you a range of what the market value will be. ?Only an Appraiser will offer a single market value of a property. ?The end product of what a Realtor will offer as a market value will be contained within a document that is typically referred to as a Comparative Marketing Analysis. ?Keep in mind during your own Comparative Marketing Analysis that no two properties are exactly the same. ?A skilled Realtor has the ability to make adjustments for the differences found between a subject property and the comparables.
What are the Various Methods of Determining a Property Market Value?
The first and most widely used method is called the Sales Comparison approach. ?This method is typically used by comparing the subject property to other ?like? comparative properties that are either presently on the market, have sold or have expired from the market. ?Examples of other methods are the Cost Approach that combines the cost of land and the cost of building a new home, and the Income Approach which establishes property value by virtue of expected income for a given investment property.
Step #1 ?Initial Property Visit
Before a Realtor begins the process of determining market value, it is their responsibility to visit the local town hall and typically pull the Tax Assessor?s Field Card, Plat Map and Schedule A. ?This information provides the Realtor with a plethora of information before they even begin, such as easements, finished area living space, plot size, utility and cooling/heating information, bedrooms/baths, etc. ?The first part of the process is a visit to your home by the Realtor. ?The purpose of this initial visit is to gather as much information about the property, neighborhood, condition of the house/land and to determine if there are any discrepancies with the public information gleaned from the local municipality. ? The Realtor will ask questions about the property, and you. ?The purpose of these questions is to gather further information about the property, to determine the property condition and to determine what should be completed in advance, in the event that the property is to placed on the market for sale.
Step #2 ?The Sales Comparison Approach for Determining Market Value
West Norwalk Contemporary
The Sales Comparison Approach for determining market value includes the comparison of the subject property to other?similarlocal properties within the same town. ?The style of the property should be the same or similar, such as Colonials, Ranches, Victorians, etc. ?The square footage and land size should ideally be similar within 10% of the subject property. ?Also the properties themselves should be within no more than a mile and a half from the subject property.
The subject property is first compared to other similar properties that are for sale in order to help determine where the property would fit strategically/competitively within today?s market. ?This information is merely and indicator as anyone can place a value on a property, but that is no proof that it is either accurate or will sell. ?These are the properties that are testing the market. ?The subject property is then compared to other similar properties that have sold within the past six months. ?Six months is normally used because it is considered to be a part of the same current market. ?Sold properties are the most valuable to this exercise as these are properties are properties who have not only tested the market, but have now proven the market because a Buyer has decided to purchase. ?The subject property is then finally compared to those similar properties that did not sell, or those properties that have ?expired?. ?Over 90% of the time when a property does not sell, it is because of price. ?Sure, there can be other factors such as poor marketing or a misrepresentation but primarily it is due to over-pricing. ?Although these properties did not sell, they are very valuable to this exercise as they assist the Realtor to determine a financial ceiling for the subject property.
Step #3 ?The Final Comparative Marketing Analysis
The third and final step is drafting the Comparative Marketing Analysis document. ?This document takes both the subjective?information about the property gathered at the first meeting and is blended with the objective data gleaned from the local multiple listing service about the current properties on the market, the last six months of sold properties and the information about the properties that did not sell. ?Graphical analysis is used as well as comparative tables and data charts. ?Combined together will be a narrative about what should be done to the property before the sale, information about the current local market and finally the range at which the property value will be. ?The property value is just that, the property value. ?The property value is not the List Price of the property. ?To determine the List Price of a property prior to marketing other factors must be taken in to consideration such as the local List Price/Sales Price Ratio, Days on Market, and the local market trend for that given kind of property (i.e. single family, condominium, muti-family, etc.).
Several very important ancillary pieces of information should also be included, but not limited to the Marketing Plan. ?The Marketing Plan should be a step by step process on what the Realtor will be doing in order to obtain the most amount of money for the property within the shortest amount of time. ?Additionally, you will find a resume of the Realtor as well as reference-able past clients who will vouch for a credible and trusted working experience.
If you are interested in determining the value of your home, regardless of where it is in Fairfield County please visit my website at http://www.CTHomeConsultant.com and request it or call/text me at 203-858-2241. ?I can also be reached at wm.karchere@pprealty.biz.
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