Market Value
When an Appraisal is done, its ultimate goal is to define a Market Value for that property. So, in short, market value is the value of a real estate property in a free competitive market.
Many variables are considered by the Appraiser when analyzing the monetary worth of a property. Supply and demand are the essential factors, but there are others - like structural condition and aesthetic features - that also weigh into the appraiser’s analysis. Sometimes, when a comparative analysis is not enough to assert a price to the house, an Appraiser would use the Replacement Cost and the Income Approach to better evaluate them.
Market Values are not set in stone. Here are three things that can affect it:
- Location, location location. It’s a real estate cliche, right? Because it’s true. A house that is completely identical to another (build-wise) can get sold at a much higher price just because it’s in a premier location.
- Plastic Surgery. You can improve the effective age of your house (and its value) by doing renovations and adding valuable assets to your house. A sauna could not only provide you a good time during the winter, but also bring the market value of your home up.
- Chance. If a trendy retailer sets shop across the street from you, your house may have a spike on its market value. But it could go the other way around too, if - for example - there’s a spike in criminal activity within your area.
The truth is that a comprehensive appraisal keeps an eye on all available information in order to have a clear picture of the property’s value.
Real estate tips:
Find more terms in our real estate Glossary!
And use The OFFICIAL Real Estate Agent Directory® to find an agent for you!
Popular Real Estate Terms
The meaning of plot refers to a parcel or a small lot. A plot is essential in determining the land cost. Additionally, it defines a diagram or schematic drawing of a building or piece of ...
Corporation having only one person, A corporation sole is primarily used for the purposes of a nonprofit ecclesiastic church related organization. Ina church, the corporation sole is headed ...
To secure a listing by a real estate agent for a certain parcel of property. For example, a real estate broker wishes to list as many properties a possible to built an inventory of future ...
Charge assessed a mortgagor by the mortgagee when assuming a pre-existing mortgage. The assumption fee is often included in the closing costs when purchasing property. ...
Percentage of rentals estimated not to be made because of actual and anticipated vacancies. ...
Retail businesses in the same locality having a parking lot servicing them. The center may contain a department store, small retailers, and restaurants. There may also be a movie theater. ...
Value of agricultural land as determined by its ability to produce crops and livestock. ...
Same as term Veterans Administration Mortgage: Mortgage guaranteed up to 30 years by the Veterans Administration to veterans meeting minimum requirements. Originally established by the ...
An entrance hallway from the outside of a building. Foyers are intended as a gathering place for people either before exiting or upon entrance. ...
Have a question or comment?
We're here to help.