Frequently Asked Questions

0 Flares Facebook 0 Google+ 0 LinkedIn 0 Twitter 0 0 Flares ×

Real Home Value Calculator: Assessed Value vs Market Value

Understanding a home’s true market value is about more than pictures, software assessments and price-per-square-foot. Whether you’re a current homeowner thinking of selling or are house-hunting, it’s crucial you understand what factors affect home valuation. By partnering with a local market expert, sellers will avoid pricing their house out of the market (the kiss of death in real estate) and buyers will ensure they get a good deal on their next home.

So, how do you accurately calculate a home’s value? After all, the value a home is assigned by its town or county and the one it’s given when it’s listed are often dramatically different from one another. Which one is accurate and what does it all mean? Read on to learn more.

Assessed Value vs Market Value: What’s the difference?

When it comes to home value, you’ll often hear two terms, assessed value and market value.

A home’s assessed value is often the lower number of the two, and is the value given by your municipality or county. Investopedia defines assessed value as “the dollar value assigned to a property to measure applicable taxes.”1 Although property tax laws vary, assessors commonly arrive at this number by taking into account the following:

  • What comparable/similar homes are selling for in your area.
  • The value of recent improvements.
  • Income from renting out a room or space on the property.
  • How much it would cost to rebuild on the property.

A home’s market value, or Fair Market Value, is the price a buyer is willing to pay or a seller is willing to accept for a property. A skilled real estate professional will arrive at the value using a variety of metrics, including:

  • External characteristics, such as lot size, home style, the condition of the home and curb appeal.
  • Internal characteristics, such as the number of rooms and their size, the type and condition of the heating or HVAC system, the quality and condition of construction, the flow of the home, etc.
  • The sales price of comparable homes that have sold in your area.
  • Supply and demand; that is, how many buyers and sellers are in the area.
  • Location; that is, the quality and desirability of your neighborhood and other community amenities.

Why are these values often so different? An assessor usually estimates your property’s market value during a reassessment or if you make a physical change or improvement to it.2 As a result, a property may not be reassessed for many years. While your home’s market value may fluctuate with the market, your home’s assessed value is more likely to remain steady.3

What Determines a Home’s Value?

You’ve likely heard the motto of real estate: “Location, location, location.” This means a home’s value relies on its location. While the home and structures on the property will likely depreciate over time, the land beneath it tends to appreciate. Why? Land is in limited supply and a growing population puts increased demand on the housing supply. As a result, values increase.4

Other factors that affect your home’s value include the function and appearance of the property, how well the home and other structures are maintained and whether the home is a lifestyle property, such as a ranch style with mountain views or beach bungalow.

Ultimately, the best indication of a home’s value is the overall supply and demand of the market. This is why we recommend you partner with a real estate professional who takes all of these factors—the assessed value, local market conditions, home features and has physically walked through and experienced your home— into consideration to determine the most accurate market value.

How to determine if a property is comparable to yours.

Both assessed value and market value are partially determined by the sales price of similar, or comparable, homes in the area. To determine if a home is comparable to yours, look for the following characteristics:

  • Lot size
  • Square footage
  • Home style or similar architecture
  • Age
  • Location

While you may not find a home with the same exact characteristics as yours, you’ll likely find a few that are close. To account for any disparity, adjust the sales prices of the comparable properties. Look at the differences between your property and the one in question and determine if the differences increased or decreased the sales price and by how much. For example, if your home has two bathrooms and a similar home only has three, estimate how much that extra bathroom increased the sale price of the similar home. The adjusted sale price is the estimation of what the property would sell for if the properties were exactly the same.2


Where can you find comparable sales?

Fortunately, you can find comparable home sales in avariety of places.2

  • Your local assessor’s office is able to provide a list of recent sales you can browse and compare or a sales history of a particular house, home style or neighborhood.
  • Your municipality. Many cities keep local sales information in their offices or post it online.
  • Online databases, such as a real estate database
  • Your local newspapers may offer some real estate information in the form of quarterly sales reports in the business or real estate sections of the newspaper.
  • Our office. We regularly do Comparable Market Analysis of homes in our local area.


How to calculate your home’s value.

By answering a few questions about your home, property and the local market, you can begin to estimate your property’s value. We’ve also included a worksheet for you below…

Home Value Questions:

When was your home last assessed?

What was its CMA assessment value?

What is your area’s average sales price?

What is your area’s average price/square foot?


  • Is the architecture and exterior structure of the home consistent, superior or inferior to other homes in the area?
  • Does the era or genre (Modern, Victorian, Ranch, Cottage, etc.) add a premium based on current design trends?
  • How does the floor plan and room size proportions of the home compare to other homes on the market?

Interior Structure:

  • How does the kitchen compare to others on the market?

○       Updated or outdated

○       Floor plan

○       Appliance packages

  • How does the Master Suite compare to others on the market?

○       Size

○       First/second floor

○       Updated or outdated

○       Access to Master Bath

  • How does the Master Bath compare to others on the market?

○       Updated or outdated

○       Shower and bath

○       Flooring

Outside Areas:

  • Are there views, outdoor living areas or recreational areas?
  • Pools
  • Ponds
  • Patios
  • How does the landscaping and hard-scaping compare to the market? (e.g., built elements such as walkways, patios, decks, etc.)

Overall Condition of Home

  • What is the level of repair needed to compete with other homes?
  • Does the home need to be staged? How does it show?
  • What curb appeal projects are necessary to be consistent with others on the market?


If you want to accurately assess a home’s value, it’s crucial to know about the market activity of our local area. We can help! Give us a call to get the scoop on the local market.


Sources: 1. Investopedia

  1. New York State Department of Taxation and Finance
  2. Realtor.com
  3. Investopedia,

Sept 14, 2017
Increase your home’s value up to 28% with these 5 easy tips
Great curb appeal not only makes your home the star of the neighborhood, it can also improve its value and help you sell it for more. Whether you’re thinking of listing your home or just want to make your home the envy of your neighbors, here are several ways to increase your home’s curb appeal.


1  Make your home’s exterior look like new.

For many potential buyers, the condition of the exterior of a home can offer clues to the condition of the interior. The first place to start when boosting curb appeal is the exterior of your house.

Paint. Paint is the best way to make your home appear newer. While you can paint your home yourself, if it’s large or more than one story, consider hiring a professional. Painting is a fairly inexpensive improvement with between 60 to 100 percent return on investment.1

Maintain your siding. Over time, weather and the elements can make your home’s siding appear dull and dirty. Use a pressure washer to clean stains, spider webs and accumulated dirt and grime, or use a soft cloth and a household cleaner to get into those small nooks and spaces. Although the average life expectancy of siding ranges from 60 to 100 years, depending on the material, extreme weather may reduce this number. If you need to replace the siding, you’ll enjoy a 77 percent return on investment.1

Paint or replace garage doors. If your garage doors are in good condition, give them a new coat of paint. If they’re beginning to show their age, consider replacing them. Not only are new garage doors more energy efficient and better insulated than older models, they also have a 91.5 percent return on investment.1

Maintain your fence. Replace rotted or worn posts and panels and freshen it up with a coat of paint. If you have a hedge that serves as your property’s border, keep it trimmed and in good shape.


2  Pay attention to the small details.

The small details tie your home’s exterior together and help it stand out from others in the neighborhood.

Paint front door, trim and shutters. This inexpensive improvement adds brightness to a home, whether you choose a bold color, a neutral tone or classic white.

Install new door fixtures and be sure they match in style and finish and complement the style of your home.

Update your house numbers. Make sure potential buyers and guests can find your home. If the numbers have faded or need an update, replace them. If choosing a metallic finish, make sure it matches the finish of your exterior light fixtures.


3  Tend to your driveway and lawn.

Well-landscaped homes may sell for between 5.5% and 12.7% more than other similar homes and studies show it may also add up to 28 percent to your home’s overall value.5

Place a border along your driveway or walkway made of brick, stone, pavers or another hardscape element to add visual interest to a plain driveway.

Maintain your green space. If you have grass, a well-maintained, green lawn makes your home look inviting and picturesque. However, in many parts of the country, water conservation is becoming more important. Xeriscaped landscapes incorporate drought-tolerant vegetation that thrives in warm, dry climates, such as lavender, sage, wisteria and agave, with water-saving drip irrigation and mulch. Xeriscaping has a cost savings of 36 cents per square foot annually through reduced irrigation and maintenance costs.3 Additionally, these landscapes are virtually maintenance free, which makes it an attractive option for busy buyers.

Include trees and shrubs to create texture and add interest to your landscape. Planting a few types of trees and shrubs of varying heights, widths and flowering times boosts your home’s curb appeal year-round.


4  Make it feel inviting.

It’s no secret that emotions play a role in a person’s decision to purchase a home. Stage the outside of your home to evoke warm feelings.

Stage your porch. If you have a front porch, make it feel more inviting by including seating, such as a chair or loveseat, an outdoor rug and a small table. If space is an issue, incorporate small decorative touches, such as a festive wreath or potted plant.

Hang flower boxes on your front porch railings and/or below your windows. If you don’t want to affix flower boxes to your home, purchase nice planters and containers and place them around your porch or on your front steps.

Choose flowers and plants that bloom at different times of the year for year-round appeal. For example, bulbs not only bloom all spring, they also multiply and come up every year. Perennials often flower for most of the year and will prevent you from having to replant them every year.

If you don’t have a green thumb, choose low maintenance plants and flowers. Flowers such as lavender, rosemary, and zinnias are a few low-maintenance and drought-tolerant options.


5  Boost Your Online “Curb Appeal.”

For those interested in selling, it’s important to know the effect online curb appeal has on a home. The better impression your home gives online, the more likely buyers will want to see it in person. Here’s how to get your home ready for its listing debut.

Stage your home. Staging shows your home in its best light and helps potential buyers picture themselves living there.


Jan 13, 2018
What’s Your Home Buying Power?
If you’re in the market for a new home or investmentproperty, one of the first questions you’ll probably ask is, “What can weafford?” Many buyers become so caught up in how much they can afford that theydon’t realize their total buying power—that is, the total amount ofpurchasing potential they actually have.

Buying Power Defined

Your buying power is comprised of the total amount of moneyyou have available each month for a mortgage payment. This means the money youhave each month after fixed bills and expenses. Any money you’ve saved for adown payment, the proceeds from the sale of your current home, if applicable,and the amount of money you’re qualified to borrow all impact your buying poweras well. When you take all of this into account, you may find you are able topurchase a larger home or a home in a more desirable neighborhood, or you mightrealize you should be looking for homes in a lower price range.

What About HousingAffordability?

Housing affordability is a metric used by realestate experts to assess whether or not the average family earning an averagewage could qualify for a mortgage on the average home.1 Althoughthis figure is essential to creating a comprehensive overview of the realestate market, it’s not a factor you should consider in your home search. Whatmay be considered affordable to you based on your income and other factors maybe different than what’s affordable to the average buyer.

Why Buying PowerMatters

A common misunderstanding is that a home’s list pricedetermines whether or not you can purchase it. Although it’s important to lookat the price tag, it’s essential to consider what your monthly payment will beif you own the home. After all, the purchase price doesn’t include the housing-relatedexpenses, such as annual property taxes, homeowner insurance, associatedmonthly fees and any maintenance or repairs. Figuring out the payment willprevent you from overestimating or underestimating your buying power. Afterall, you’ll live with your monthly payment, not the sales price.

Once you have clarity on your buying power, you’ll be ableto buy the home you want, instead of settling for a home because you feel it’sthe only one you can afford. It will also prevent you from becoming “housepoor,” a common term for someone who’s put all their money toward the downpayment, leaving them nothing left over for fees outside of their monthly housepayment. Both scenarios can negatively impact the lifestyle you want to live.Understanding your buying power can help you get the home you want withoutsacrificing the lifestyle you desire.

If you haven’t soldyour current home yet, a Comparative Market Assessment (CMA) will give you ageneral idea of how much you may get for your home based on what other homeshave sold for in your area. Contact our team for a FREE CMA!

Calculating YourBuying Power

You might be wondering, “How do I know what my buying poweris?” Buying power is calculated by adding the money you’ve saved for a downpayment and/or the money you made from selling your home (minus fees andmortgage payoff) to all of your sources of income and investments that could beused to make your monthly payment. Make sure to include your monthly pay,commissions or tips, dividends from investments, payments from rentalproperties or other monthly income you receive as well as the loan amountyou’re willing to finance and qualify for.

Most lenders advised buyers to spend no more than35 to 45 percent of their pretax income onhousing, meaning all your income and sources of revenue prior to paying taxes.Make sure you factor in not only your mortgage payment, but also property taxand home insurance to the cost of housing.2 However, other financialexperts advise spending no more than a very conservative 25 percent of yourafter-tax income on your housing expenses.2  Whether you plan to spend the average, playit conservative or split the difference is up to you.

Traditionally,mortgage lenders have targeted the ideal housing expense amount to be a ratioof 28 percent or less.3

However, these figures bring up an important point: youdon’t have to spend all of your savings and available monthly income on amortgage payment. It’s important to set money aside for regular homemaintenance, unexpected repairs and monthly fees, such as a condominium orhomeowners association fee. While the above ratios are commonly accepted, alender will look at your total financial picture when they decide how muchthey’re willing to lend. It may be tempting to take out a large loan in orderto purchase the home of your dreams, but keep in mind the less money you haveto borrow, the stronger your buying power may be.


4 Things That ImpactBuying Power

  1. Credit score.Agreat score can help you lock into a lower interest rate.
  2. Debt-to-incomeratio. The lower the ratio, the better risk you may be to lenders as longas you have an established credit history.
  3. Assets,including the documentation of where the money for the purchase is coming fromand the mix of your investments.
  4. Down payment.The more you’re able to put down, the less you will have to borrow. With a downpayment of 20 percent or more, you won’t have to purchase private mortgageinsurance (PMI) and you may also be able to negotiate a lower interest rate.


I still have questions!

Contact us with your question and we’ll be happy to assist you!

0 Flares Facebook 0 Google+ 0 LinkedIn 0 Twitter 0 0 Flares ×