If you’re using a Zillow Zestimate to get an accurate home valuation, you may get a skewed result, which could then affect your home’s listing price. While Zillow has historically provided relatively accurate estimates based on the year the home was built, the number of bedrooms, square footage, and other quantitative data, they’ve recently changed their algorithm. Even when Zillow was fairly accurate, it still provided only an estimate as opposed to a true valuation done by an appraiser or Comparative Market Analysis. Here’s how to get an accurate home valuation and why relying on Zillow or similar sites is usually a bad idea. Outstanding client service, experienced business practices, and ingenious marketing strategies are what make our team the most trusted team in the area.Outstanding client service, experienced business practices, and ingenious marketing strategies is what makes our team the most trusted team in the area.
A home valuation is just a fancy way of saying what the value of your home is. They are used during real estate transactions such as buy-sell or refinances to ensure homeowners or buyers are not overborrowing for a property. The home is used for collateral in a mortgage, and if the borrower defaults on his or her loan, the lender will sell the home to recoup the money lent to buy it. If the home was overvalued and they lent too much, they could lose money. The home valuation ensures they will be able to recoup costs should the mortgage not be paid in full.
A Zillow Zestimate is an automated home valuation tool and is recommended as a starting point when determining the value of your home. It incorporates user-submitted and public data and takes into account home facts, location, and market conditions. Zestimates are done entirely online, and no representative of Zillow will visit your home to perform an appraisal. Banks and lenders do not use Zillow or similar services to estimate property and instead rely on the expertise of a licensed appraiser. A Zestimate can be off by nearly 5% nearly 40% of the time in some markets, which amounts to around $15,000 on a $300,000 home.
The main difference between the two is that a Zillow Zestimate is simply an algorithm. You punch in data, and a value pops out. There is no actual human involved who views your home, compares it against others on the market, and produces a detailed report. When an agent conducts a valuation, they are actively involved in the process and create a valuation that is personalized and in-depth.
Ellen DeHaven represented our family in the sale of our parents' home on Lake Minnetonka. Having bought a house through her before, we knew she was a real professional who combined local market knowledge with a thorough command of the sales and closing process. She did not disappoint on the new assignment. It was a seamless path from initial engagement to closing. If you are considering buying or selling...
Ellen DeHaven has the knowledge and experience to help you sell your house. She spends money as needed to market your home, and she knows who to call for any problem. This is part of her enthusiasm which keeps the marketing really active. Even when there are challenges, she is always working to find the solutions and to find the right buyer for you. There are many good brokers available, but Ellen h...
Ellen is the consummate professional and I would highly recommend working with her. Based on her years of experience, she has unmatched insight into market dynamics and early access to inventory. We looked at many properties to get familiar with the area, and she provided lots of history and context regarding each property. She is tireless in pursuit of her client's interests, and is highly responsive...
Ellen DeHaven has the knowledge and experience to help you sell your house. She spends money as needed to market your home, and she knows who to call for any problem. This is part of her enthusiasm that keeps the marketing really active. Even when there are challenges, she is always working to find the solutions and to find the right buyer for you. There are many good brokers available, but Ellen has a s...
We used Ellen when we purchased our condo 11 years ago. Before she would sell it to us she took us to several homes to make sure we wanted a condo - she did not have to do this. Based on this, when we decided to list our condo, Ellen was our immediate choice. She handled the sale efficiently and always in a friendly manner. If we decide to buy again, we will definitely use Ellen.
Ellen was a joy to work with! Her impressive knowledge of lakefront properties, pricing expertise, and professionalism made selling our home easy and fun. Her recommendations for home improvements were spot on and contributed to us getting the price we wanted. We would highly recommend Ellen to anyone buying or selling a home in the Twin Cities!
Ellen sold our multi-million dollar property in a highly efficient manner with utmost professionalism. She was creative in her approach and easy to work with. She is established and highly networked appropriately using her vast network of resources to get things done.
Thank you, Ellen. Best real estate experience we have had. You and your team were on point and got the job done.
Just wanted to thank you and your team for the outstanding job you did in helping us sell our house. The entire process from pricing to closing was handled in a most professional, competent, and courteous manner. Your market knowledge and experience are quite evident. We would certainly recommend you to anyone considering a real estate transaction. Keep up the wonderful work. All the Best,
Thanks again for everything. Working with you was so easy and such a pleasure. You probably hear this all the time, but you are just fun/easy to be around. We are excited about our new place and so grateful for all of your help. Let us know if you ever want to stop by for lemonade or a glass of wine. Have a great summer. Thank you,
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There are two accurate ways to perform home valuations: with a Comparative Market Analysis and an appraisal. ​​​​​​​Here is how the two differ:
A Comparative Market Analysis (CMA) is a tool used by real estate agents to value a home. It evaluates similar homes that have recently sold in the same area. Agents find comparable sales and use them to conduct a sales comparison. In most cases, an agent will find three homes that have recently sold and are as similar to and located as close to the home being valued as possible. Each one is then analyzed to pinpoint differences between it and the home being valued. Once these differences are priced out, the price of each comp is adjusted to see what it would cost if it was identical to the home being valued were it to be sold in the current market.
An appraisal is an unbiased valuation of a home based on a professional’s opinion. They are usually what mortgage companies use for home purchases and refinances. A lender usually orders a home appraisal and the cost of the appraisal, sometimes up to $500, is paid by the homeowner. An appraiser does a complete visual inspection of the interior and exterior of the home as well as taking into consideration recent sales of similar properties and market trends. The appraiser then compiles a detailed report on the home, including an exterior building sketch, a street map showing the home and any comparable sales, photos of the home and street, an explanation of how the square footage was calculated, and any other relevant information.
Though getting a valuation in order to sell your home is the most common reason to get a home valuation, it’s not the only one. ​​​​​​​Here are some more situations when a home valuation may be necessary:
Lenders base the amount of their loans on the value of your property and usually allow you to borrow a maximum of 75% to 96.5% against your property. Knowing what your home is worth allows lenders to calculate your equity in the home. The more equity you have, the better terms you will receive on your refinance.
If you’re doing home improvement projects to increase the resale value, you want to make sure you’re not pricing it out of the market. If your home is already priced on the high-end for your neighborhood, making too many improvements could make it more difficult to sell. When you get a valuation, you can see how your home compares with others in the neighborhood and let this guide your home improvement decisions.
If you want to borrow cash against your home, getting a Home Equity Line of Credit (HELOC) could be a good option. To qualify, you must have a certain level of equity in your home. Most lenders require at least 20%. Getting a home valuation will help you determine if you qualify and will be used by the lender to make a decision on your loan.
Though it’s not a necessity, simply knowing the value of your home is good information to have. It will help you plan for the future and deal with unforeseen circumstances when you might be in a position that requires extra money or a quick relocation. Knowing how much equity you have in your home and how much you may be able to borrow against it or sell it for will help you respond to any financial curveballs that life throws at you.
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