House Valuation Process. How is the value of my house determined?
One thing we do at www.nnyhomebuyer.com is help home owners determine the value of their home in its current condition. To understand the house valuation process is extremely important because it helps us come up with different strategies that can be used to solve the home owners problem. In this article I will show how we determine a houses current market value.
- Conduct detailed Property Inspection Report
- We start by doing a walkthrough of the house with the owner. In this process we make note of important property features such as bed/bath count, total house sqft, condition of major structural components, ect
- We then take note of all of the house finishes, such as flooring, walls, light fixtures, kitchen cabinets, ect
- Next, we make note of the condition of everything. We determine what needs to be fixed/replaced and what is fine the way it is
- Finally, we evaluate the neighbors and area. We need to gauge the areas desirability to a prospective buyer
- Run a Comparative Market Analysis (Comps)
- We then access the area’s local MLS (Multiple Listing Service) and search for SOLD houses with similar bedrooms, bathrooms, sqft, garage spaces, and condition.
- We typically look in a 6 month time period, but will extend it up to 1 year in some circumstances.
- Another important factor is the proximity of each house from one another. Typically our subject house must be within 1 mile from the SOLD properties.
- We try to find 3-5 houses that have sold. We run comps for the house in its current condition and comps for it at the top of the market.
- Develop a Scope of Work
- Now that we know what the house is worth if it’s all fixed up, we start putting together a scope of work
- We use our experience from past rehabs to determine how much money it will cost to bring the houses value up to the top of the market,
- Discuss Valuation Findings w/ Home Owner
- Once we have our Comps and Scope of work, we schedule a meeting with the home owner to review our findings
- We show the home owner what their house is worth in its present condition and explain the challenges they will face when trying to sell it
- We then show the home owner the scope of work and how much it will cost to bring the property’s value up
- Next we show the owner what the property can be worth if the property is fixed up Finally, we present the owner with several next step options
- What are our options?
- We can purchase the property from them AS IS for cash and they walk away trouble free
- We can partner with them and manage the rehab & sale process. We would oversee the rehab and they could hire our brokerage Marble Key Realty to list it on the market for top dollar
- They can sell us the house and carry the mortgage themselves. This is called Owner Financing. They would become the bank and collect a monthly payment + interest.
- They can hire our brokerage Marble Key Realty to list it AS IS on the market for a price that reflects its current condition.
People contact Genuine Homes at www.nnyhomebuyer.com for many reasons. We’ve helped clients who are going through a divorce, owe back taxes, facing foreclosure, or just looking for a change of scenery. We’ve helped people in Watertown NY, Black River NY, Evans Mills NY, Sackets Habor NY, and many other areas in Jefferson & Lewis County. We aren’t here to judge you. We are here to work with you to figure out a solution to any problem you may have.