Fair Market Value
The definition of Fair Market Value in the real estate business is the highest amount that could be received on the sale of a property when there are a willing buyer and a willing seller. But that seems kind of vague, right?
Let’s give Fair Market Value some context:
Truth is whenever a home seller says “I want to sell my house!”, both the home seller and the real estate agent wants to sell the property for the highest price they can, right? However, the home buyer, obviously, wants to buy the house for the lowest price he/she can. So, an “arm wrestling match” regarding the value of the property begins. At the end of that negotiation, when the home seller and the home buyer agree on a price, we have the Fair Market Value of that estate.
Things you should be on the lookout to define a precise Fair Market Value of a property:
- How is the market right now? Do a Comparative Market Analysis.
- Is the house in good conditions? Have a professional Appraisal of the property done.
- How much would it cost to build a new one just like yours? Try the Replacement Cost Approach.
RealEstateAgent.com ADVICE:
Now that you’ve done your homework regarding Fair Market Value the choice is yours: you can either access our Real Estate Agent Directory and search our amazing database for that trustworthy real estate agent that will help you make your house sell, or you can keep searching for other terms on our Real Estate Glossary box below. Good luck!
Popular Real Estate Terms
Land development planning model theorizing that an urban area grows in rings expanding out from the central business district. The second ring is a shifting area having manufacturing and ...
A backfill defines the act of replacing a vacant lot. People use a backfill as a replacement for an unoccupied position. Backfill in construction and archaeology! The most common ...
To understand what a principal broker is, we have to go back up the family tree of real estate.You do understand all brokers can be real estate agents, but not every real estate agent can ...
What is a balcony? A balcony is a platform that extends outwards from the upper level of a building, typically attached to a wall or supported by columns. Balconies can be made of various ...
national trade association of people engaged in the mortgage banking business, dedicated to the betterment of the mortgage banking industry through education, legislation, and high ethical ...
Received immediately when an investment is made or contract signed. For example, a real estate limited partnership may require that an investor pay a 3% sale fee at the time of initial ...
Are you looking to sell your house or buy a new one? Then, you'll most assuredly encounter the term instrument at some point. If you don't want to ask people: "Please, define instrument to ...
An installment sale of land whereby the seller accepts a mortgage from the purchaser to complete the conveyance. After the mortgage has been satisfied, the deed is conveyed to the ...
Individual having permission to act ob behalf of a bank or other financial institution in a specified locality to attract interest borrowers. ...
Have a question or comment?
We're here to help.