Now almost every homeowner that has seen one the "Online Home Values" that are now being offered by Trulia, or Zillow call and express to me that their home is not only worth more than what it is/was listed for but it is even higher than that!
Let me just say this in the most simplest terms, they are WRONG! Yes I said it, and I am sure in some parts of the country perhaps their pricing is correct, but not here on the South Shore of Long Island. Experts have done research and their values are actually off by around 20% and in some cases up to 50%! Now most people will than ask how can they do that, it is simple they put a disclaimer on their page and that's it.
If you really want to know what your home is worth you need to make sure the information that the value it is being based on is accurate, and up to date! On many of these sites the value of your home is based upon the closed sales, under contract sales but they don't often reflect current sales. Now here are the biggest problem with these sites. Problem #1 if your neighbor or someone across town from you decides to over price their home that doesn't raise your value obviously, but according to these sites it does. Problem #2, just because a house has the same number of bedrooms or baths it does not mean they are worth the same. This is where style of home does come into play, a Colonial style home is going to have much more square footage, than a Cape style home even if it does have the same amount of bedrooms. Problem #3, we have no idea which of these formulas they are using when they calculated the value of YOUR home! Problem #4, they could never receive information as quickly as a Realtor can, computers are a wonderful tool in today's market but that will never replace hard work, and research by an actual person!
So how do you figure out what the value of your home actually is, well that is simple. Call a Realtor!
They should be able to provide you with at least 3 comps for homes that sold within the last 180 days - with similar characteristics to your home (ex-square footage, rooms, bedrooms, baths, taxes). This will be crucial information, prior sales are what the bank will be looking for. When you are looking at these comps your should be sure to see how many days this home was on the market as well.
They will also show your homes that went under contract with all the same characteristics that I previously mentioned. This will show you about what price bracket you should be in when you price your home to get an offer. This will be a great way to see how long homes in your area are for sale before they get an accepted offer!I personally believeit it is better to be at the top of a buyers price range, than at the lower end.
Lastly they will show you homes that are on the market, again all the same characteristics and this is where you have the chance to judge your home from a buyers prospective. From their prospective you want to make sure that your home shows value for that price range. I do not mean price it below market value, just simply look from a buyers prospective and if your home is all original, and other homes on the market are updated you should make sure you adjust your price accordingly.
This is the ONLY information that will give you the real value of your home, so take the time and speak with your Realtor regularly about your neighborhoods current market!
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