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
Government compensation to farmers not to grow products to preserve the land and maintain stable agricultural products. ...
Person's sole ownership of real property. ...
Real estate sales contract where possession and use is provided to the buyer, but the deed is kept by the seller until the full purchase price is met whereupon the title is placed in the ...
Part of the premiums and interest that have not been returned to the annuitant before his death. ...
Major city in a metropolitan area. ...
When it comes to the subsurface rights definition, the meaning needs to be defined from the US perspective as these rights are not a default elsewhere on the planet. In general, in the US, ...
Item falling under Section 57 of the Internal Revenue Code that may result in the imposition of the alternative minimum tax (AMT). These items of otherwise exempt income or deductions or of ...
Arches, either roofed or open, mounted on a series of pillars to form a passageway or walkway. ...
Commercial building having several different uses blending together. For example, retail shops are on the first floor, professional offices are on floors two through ten, and a restaurant ...
Have a question or comment?
We're here to help.