If you plan on selling your house on your own, and do not want to deal with Agents, the easiest way is to have a professional appraisal done on your home. If you have a lot of time on your hands, and if Deed Recordings are publicly available in your locality, you can also search for all properties sold in the last year or so that are similar to your house.
Depending on the size of your house and your location, a professional appraisal should cost somewhere in the $350 to $500 range. For your investment, you will get a complete analysis of the estimated value of your home. Factors such as condition, proximity to services, and overall neighborhood values all will all be taken into account. There are three general approaches to determining the value: the cost (or replacement) approach, the comparison approach, and the income approach.
In the cost/replacement approach, a determination is made as to what the cost would be to replace (rebuild) your home in today's market.
In the comparison approach, the appraiser will, as in a CMA, determine what comparable properties have sold for in the last 6 months to a year. This approach will directly compare your house to these other properties, adding to value for special items that your house has, or deducting value for items that your house lacks (in relation to the comparable's). In all likelihood, this comparison approach will give you the most accurate estimation of the worth of your house.
If I pay for an appraisal now, will the buyer be able to use it?
A couple of factors will determine whether or not a buyer can take advantage of your appraisal. The most important lies with the policy of the lender which will be handling the buyer's financing. It is completely within the lender's rights (and more than likely) that they will want to order a new appraisal. In addition, there is the question of timeliness. If you have a professional appraisal done now and it takes 4 months to get a contract on your house, it is probable that the lender will require a more recent appraisal.
Is the value locked in stone?
Absolutely not. An appraisal, no matter how scientific, still ends up being the professional opinion of the appraiser. The appraiser must compare, for example, the condition of your house in relation to the comparable properties, which to some degree is a judgment call. Nevertheless, an appraisal will give you a reasonably good idea where your house fits in relation to recently sold properties. From that point you are well on your way to setting a fair price.
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