Know Your Worth: 4 Reasons Why You Need to Know the Value of Your Property
We all know that understanding your home’s market value is essential when you’re selling, but did you know that there are many benefits of knowing your home value even if you’re staying? Many first-time buyers only make “educated guesses” and value their home much higher or lower than their true worth. Here are some reasons why you should know the value of your home, no matter what your plans are.
Selling Your House
First, let’s talk about the most obvious benefit - knowing your home value is crucial when selling your home. When selling a property, you and your realtor must consider many factors, such as your loan balance and selling cost. Understanding your property’s value will help you and your realtor properly set the selling price for your home after considering all the factors. Home value calculators (like ours at Dena Musfy Real Estate Group) are a significant first step towards understanding the ballpark value of your home.
Home value calculators (like ours at Dena Musfy Real Estate Group) are a significant first step towards understanding the ballpark value of your home.
Many online home value estimating tools are available; however, you should never stop the process after simply looking at one of these tools. Once you have tried an online home price calculator like ours, we recommend having an expert opinion from an experienced real estate agent. They will be knowledgeable about your market and provide you with a comparative market analysis (CMA) and tools to estimate your home's price. Real estate agents work with CMA’s to calculate the value of the raw data of your home, such as square footage and room count, along with other factors like the values of properties in the surrounding area.
Refinancing
If you're looking for a better rate or lower payment on your mortgage, the first step is to consider the value of your house.
If you're looking for a better rate or lower payment on your mortgage, the first step is to consider the value of your house. Although there can be other factors to consider, having more equity in your home or property will usually make it easier for you to negotiate better loan terms. Generally speaking, lenders will allow anywhere between 75% to 96% against their property. Knowing your home’s worth will help you consider how big of a mortgage you can take.
Renovations
If your property is already on the higher side of the market, spending thousands of dollars on renovating may not be a necessary investment.
You may just want to renovate your home to make it a more comfortable space to live in, but if you are renovating in hopes of a better selling price, you need to consider the value of your home first. Surprisingly, homeowners and sellers often fail to consider the home's current value before renovating to sell. If your property is already on the higher side of the market, spending thousands of dollars on renovating may not be a necessary investment. However, if your home is on the lower price side of the market, touching up the home may yield a much better profit from selling. Talk to your realtor and consider if renovating will significantly impact the selling price before wasting time and money on unnecessary changes.
Keeping Yourself Informed
Calculating your home’s value will equip you for any sudden changes, but it may also help you know if selling your home now is a good idea if you were already coinciding with it for the future.
Even if you have no plans on moving, selling, or renovating, being in the know is a great idea. Whether it's an unexpected move for a new job or a new addition to the family (be it children, in-laws, and even our four-legged friends!), you never know what could happen. If you don’t know your worth, you may not fully appreciate the freedom home ownership provides you or the opportunities available when you have valuable property. If the last several years have taught us anything, it is that the future is uncertain - but keeping yourself informed and prepared for the future can change or even save your life. Calculating your home’s value will equip you for any sudden changes, but it may also help you know if selling your home now is a good idea if you were already coinciding with it for the future.
Looking to know more about the value of your home? Contact me today.