If you are planning to sell your house in Anchorage, Alaska soon, you might be dreaming about how much you’ll net from the sale, or figuring out how much to pay toward your existing mortgage in order to save enough for a down payment on your next Anchorage home.
Whatever you’re thinking about, the first order of business on your mental to do list is estimating how much your home is worth. This is the single most important factor in a low-stress real estate process – price it too low, and you’ll miss out on potential profit, but price it too high, and your home will sit on the market. With that said, let’s take a look at the do’s and don’t’s of home valuation.
What NOT to use: your home insurance value. Insurance coverage for your home is the probable cost of restoring your house in the event of a disaster, but it doesn’t factor in the value of your land, so it doesn’t accurately represent the market value of your house.
What to use: the Municipality of Anchorage’s property tax assessment. It’s a method used in every tax jurisdiction, and it’s done annually, so you’re not relying on outdated results – plus, it accounts for not just your house, but the land that it sits on. However, the results of the Muni’s tax assessment don’t always show local market trends, so use it as a rough draft or baseline only.
What NOT to use: what the home cost you. Unless you’re selling your home within a year of buying it, in exactly the same condition, what the home cost you is completely irrelevant, as it ignores neighborhood trends, market trends in general, and the effect of any improvements or updates you’ve carried out.
What to use: a previous appraisal. If you bought your home home within the last few years, take a look at the appraisal from that transaction. Appraisers are the experts of property valuation, so they’re opinion is trusted and respected. If you don’t know where your appraisal might be, get in touch with the Realtor you worked with to buy the house.
What NOT to use: your old neighbor’s numbers. Many houses, even ones of the same style, in the same neighborhood, and approximately the same age, are apples and oranges when it comes to value. Pride of ownership and good housekeeping look different for everyone, so take your old neighbor’s words with a grain of salt.
What to use: a comparative market analysis. This is where a Realtor adds tremendous value to you as a seller. The closest-to-perfect method, a CMA uses both active and closed listings, usually from the last 6-12 months, to approximate a competitive price for your home.
Speaking of adding value, Wolf Real Estate Professionals are ready to answer all of your real estate questions, whether you’re selling, buying, or just thinking about the future. Give us a call or email us to start the conversation. Talk to you soon!