If you’re considering selling your home, you’ve probably asked yourself ‘how much is my house worth?’ Not only will thorough property research help you to decide whether or not it’s the right time to sell, but it also means that you can go into negotiations with real estate agents feeling confident that you’ve done your homework.
Here’s how to estimate the value of your home:
Zero in on comparable homes in your area
Since location and access to facilities all factor into a property’s value, it’s essential that you look at homes that are as close to yours as possible, have been sold recently (within the last six months or so), and are alike in terms of features. This means looking at properties with similar:
- Number of bedrooms and bathrooms
- Style of building (for example, heritage or new build)
- Land size and size of the property itself
- Condition and state of repair (is it in need of renovation? How up-to-date are the fittings and appliances?)
- External features like garage or off-road parking, swimming pool, and gardens
Compare and rate features
Since it’s unlikely that you’ll find examples of homes that are identical to yours, you’ll have to rate your property against these benchmarks. So, let’s imagine that your home is a Victorian terrace similar to another that sold across the road, except that one has a much bigger backyard and rear lane access. This might mean that your property might be potentially less valuable. Then again, that place might be in need of a full renovation, so its price might only give you a ballpark figure.
Keep on top of the market
Comparing one property versus another will always be a case-by-case issue, so it’s important to be aware of the market in your area and what sells well to buyers looking for property in your neighbourhood. That means continuously checking out the real estate listings, sale prices, and auctions in your area. In addition to routinely reading property news, you can also use tools, like the CoreLogic Home Value Index, which tracks monthly fluctuations throughout the country.
Common pitfalls of valuing property
Since most people aren’t real estate experts, there are some common traps people fall into when trying to work out the value of their home. These include:
- Comparing dissimilar properties, or properties sold too long ago
- Not being up-to-date with current market trends
- Emotional attachment to the property making it seem more valuable
- Comparing with properties currently on the market – remember, the market value is the only good indicator of value, not price guides of properties yet to be sold.
- Using unreliable sources of information, instead of trusted industry publications like CoreLogic
How much is my property worth?
The property market is unpredictable – the only way you’ll ever really know how much your property is worth is when someone actually buys it. However, getting an expert real estate agent’s opinion is a good way to gain an understanding of the value of your home.
An estate agent will also be able to interpret finer data points, such as how many days a property was on the market before selling, the median house price in your area and where your property sits in relation to it, as well as auction clearance rates, which gives a good indicator of how much demand there is for property in your area.