Monday, 26 February 2018
DroneView Packages
This Old House - Do-it-Yourself

Subjectivity in Your Home's Value

Written by Posted On Monday, 07 November 2016 18:04

What is the value of my home? Home owners have been asking this question for years. While it would be easy to boil a property's value down to the sum of its bricks, wood, shingles and land, its just not that simple. There is a subjective element to valuing a home, but it is not the factors that most home sellers think. As Realtors, we are told how "special" each home is because of personal additions, decorative upgrades, and of course, the memories layered lovingly over the years that have created a strong emotional attachment for the homeowner. Families are built and life blossoms under the roofs of our childhood home,or our first home as a young family. Births, birthdays and even passing on are all life defining events lived in each of our homes. Day after day, month after month, year after year. These memories do NOT, however, hold an intangible value to a prospective buyer. Real Estate appraisals use a grid like comparison table to determine a property's value based on the proximity and similarity to three or four "comparable" properties usually sold within the last six months of the evaluation date. It is the most quantifiable and objective way of valuing property. It is the only way residential property is valued in the mortgage business. In an appraisal, the comparable properties are chosen and then adjusted accordingly to arrive at a baseline value for the subject property. There are standard deviations and adjustments used for items such as pools, sq. ft. of living area, fireplaces, screened porches, etc....

There is almost no subjective analysis conveyed except for updating and property condition. There ARE however, subjective and intangible qualities that will make one property sell faster and for more money than a similar home. The primary one is the land itself. While waterfront property is quantifiable, things like privacy, landscaping, views and proximity to dining, shopping and entertainment are not. Also, the brightness, smells and overall decor of a home are crucial in establishing demand for the property , but usually will not or can not be reflected in an appraisal. The best approach for homeowners is to not let emotions come into play when selling or buying property.  

When consulting with your realtor, please remain empathetic and put yourself in the buyers shoes. Focus on the intangible items suggested by a professional. Keep emotions in check, and get the most for your property that the market will bear! 

Rate this item
(0 votes)
Dan Wolk

Dan began his career in 1986 as one of the pioneers in the discount real estate business model in Central Florida and was one of the top ten real estate agents nationally within the Help-U-Sell Real Estate franchise for four years running. The winning combination of providing top level service with a variable commission structure designed to SAVE consumers thousands of dollars has made him a perennial "thorn in the side" of the big real estate franchise agents for decades! Over the years, Dan developed his own brand of discount real estate that still provides a "sellers choice" commission structure, while also focusing on superior customer service. Since 1986, Dan has added Real Estate Broker, Licensed Real Estate Instructor, Licensed Title Agent and and MBA to his resume, giving him a unique edge other agents simply don't possess. This arsenal of knowledge combined with unparalled problem-solving skills have made the difference for thousands of buyers and sellers for almost 30 years!

Realty Times

From buying and selling advice for consumers to money-making tips for Agents, our content, updated daily, has made Realty Times® a must-read, and see, for anyone involved in Real Estate.