6 Ways to Calculate the Value of Your Home

Knowing the value of your home helps you to have better control over your finances. You must know the current value if you want to buy or sell a home, use your home's equity to make improvements, or refinance for a better mortgage rate. Check out these six ways to find the value of your home. From a quick estimate to a professional assessment, there is a method to suit any need. 

Get a Professional Appraisal

When you need a true valuation of your home, it's best to hire a professional to calculate the real current value of your property. He or she will consider the market around your location, house, and land value, and compare your house to similar homes in the area to get an accurate figure. 

A home appraisal is typically required by a lender to calculate your mortgage. If the market has improved in your area and you believe the value of your home has increased, consider getting it appraised. The information could be used to qualify for favorable mortgage refinance rates. An appraisal by a qualified professional is generally the best way to get an accurate figure. 

Compare to Similar Homes

It's possible to get a general estimate of your home's value by doing a comparison of similar homes yourself. Check the recent sale value of at least three comparable properties. Keep in mind that this figure won't be exact, and is just a starting point. 

Use an Online Estimator Tool

A fast and simple way to get an initial value of your home is to use an online estimator tool. All you need to do is enter in some basic information and the calculator will scan through public records of previous sales, tax rates, and other area homes to give you a price. This automated valuation model (AVM) is another broad estimate. You will need a more specific, professional assessment if you want to pursue refinancing options or take another action using the information you've learned. 

Check Assessed Value on Local Municipal Site

Your home is assessed and assigned a value by your local tax assessor to determine the amount of property tax you are responsible for paying. Find the current value of your home by looking at your municipality's website. You can also check your most recent tax documents to easily see the value that was given to your property. 

Use the FHFA Calculator Tool

The Federal Housing Finance Agency is a government-run agency that offers its own online valuation tool. Use the convenient Home Price Index calculator by entering your details and getting an instant value. The FHFA uses data that tracks previous sales of your home and similar properties to give you an estimated value. 

Ask a Real Estate Agent

Another great way to get a good idea of what your home is worth is to speak with a local real estate agent and request a comparative market analysis. Your realtor will compare your home to similar properties in the area, and analyze the particulars of your house and land. They will take into consideration any updates and remodeling that you have completed, as well as basic home improvements that should be done to appeal to most buyers. 

Discuss the terms of your agreement upfront. Some realtors will do a CMA at no charge, while others expect compensation. Even if you aren't charged for the assessment, the realtor may expect you to use their services if you sell your property. 

Once you know the current value of your home, you can make better financial decisions. Remember that you need to get your home re-evaluated periodically since prices change as the market fluctuates.