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
Involves more than one borrower being responsible for a mortgage, such as with a cooperative apartment. Involves more than one mortgagee lent on a real estate project, such as with a ...
A charge based on the asset value of a real estate security portfolio to manage it. For an open-end mutual fond, the management charge is included in the selling cost of the security. ...
The Latin term pro rata has a significant meaning in legal, real estate as well as job industries. To define pro rata, anyone can take a quick vocabulary lesson. Any element that is split ...
Everyone is aware of the perplexing complexities of a real estate transaction. Enter Opendoor, a company that aims to simplify this experience. If you're a house hunter, seller, real estate ...
Recurring obligation or assurance given. ...
Evaluating a locality to determine its value and appropriateness for designated objectives. ...
Waste matter carried off through a series of conduits to a waste disposal facility. ...
The term accusation refers to a declaration made by an individual about another individual or entity having behaved in an immoral, improper, or wrong manner. The two parts of an accusation ...
Same as term nonconforming use: Property use which is in violation of the current zoning ordinance, but had been in use prior to the zoning ordinance's enactment. A nonconforming use is ...
Have a question or comment?
We're here to help.