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
One of the things that humanity aspires to is open spaces and outdoor recreation opportunities, a place where families can enjoy natural beauty in its most raw form. The open space ...
English style of architecture characterized by carving and paneling and flattened arches. ...
The minimum age required for legal competency ( in most states 18 years). ...
Law of the state establishing guidelines and requirements for constructing buildings. The standard may differ between the states. ...
Founded in1934 and located in Chicago, IL with a 1993 membership of 8,300, the IAAO seeks to ameliorate assessment standards as well as to perform ongoing property assessment research. The ...
Day the attachment of property under a judicial order becomes effective. ...
Secondary written agreement to purchase real property in the event the initial contract is not signed. ...
Also known as SIOR, the Society of Industrial and Office REALTORS® is a professional commercial and industrial real estate association that works on an international level. In the US, ...
Securities supported by a pool of mortgages. The principal and interest are due monthly in the mortgages and are passed through to the investors who bought the pool. ...
Have a question or comment?
We're here to help.