Market Value vs Assessed Value what’s the difference?
Thinking of selling your house in Suffolk and trying the determine the value of your home? These terms can get confusing:what do they exactly mean anyway? What is the difference?
Hopefully, we can shed some light and clarify some things.
Market Value by Definition:
According to Fannie Mae, “Market value is the most probable price that a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeably and assuming the price is not affected by undue stimulus.”
So this means, if everything goes according to plan, you have potential buyers looking at your house, this is an estimated amount you should expect to get.
Assessed Value by Definition:
According to Investopedia, “An assessed value is the dollar value assigned to a property to measure applicable taxes. Assessed valuation determines the value of a residence for tax purposes and takes comparable home sales and inspections into consideration.”
This is not based on market value or the current real estate market trend. This value is determined by a county assessor. The difference between the assessed value and the market value is known as the equalization rate. This rate is used by the county to figure your actual property value.
And then there is the appraised value which can be quit different then the assessed and market value. Confused yet? An appraisal is done by a licensed professional who rigorously checks all aspects of the home. While they might be 100% correct, this is still just an opinion!
What it Means For You As A Seller:
Do your homework! Make sure you have all the numbers listed above and understand terms such as the equalization ratio and fair market value. Make sure you are working with a true professional who can help you to accurately determine the market value of your home.
Setting a great asking price is critical. You do not want to set it too high and have to repeatedly lower it to get buyers in the door. Your pricing history is public information, and repeatedly lowering your price can make buyers think there is something wrong with it. And for obvious reasons, you don’t want to set your asking price too low. To get the price you want you must exercise patience and make sure you are working with a true professional in Suffolk.