Fair Market Value
The definition of Fair Market Value in the real estate business is the highest amount that could be received on the sale of a property when there are a willing buyer and a willing seller. But that seems kind of vague, right?
Let’s give Fair Market Value some context:
Truth is whenever a home seller says “I want to sell my house!”, both the home seller and the real estate agent wants to sell the property for the highest price they can, right? However, the home buyer, obviously, wants to buy the house for the lowest price he/she can. So, an “arm wrestling match” regarding the value of the property begins. At the end of that negotiation, when the home seller and the home buyer agree on a price, we have the Fair Market Value of that estate.
Things you should be on the lookout to define a precise Fair Market Value of a property:
- How is the market right now? Do a Comparative Market Analysis.
- Is the house in good conditions? Have a professional Appraisal of the property done.
- How much would it cost to build a new one just like yours? Try the Replacement Cost Approach.
RealEstateAgent.com ADVICE:
Now that you’ve done your homework regarding Fair Market Value the choice is yours: you can either access our Real Estate Agent Directory and search our amazing database for that trustworthy real estate agent that will help you make your house sell, or you can keep searching for other terms on our Real Estate Glossary box below. Good luck!
Popular Real Estate Terms
Dehydrated gypsum that is mixed with water to form a rapidly setting material. Plaster of paris sets too rapidly to be practical for most building applications, but it is useful for ...
The definition of a property brief is a document including the summarization of the attributes and characteristics of the property. Officially issued legal records are supposed to include ...
Just to be clear: an Open house is not when you invite friends over to meet your new house. At least not in the real estate world.When you hear someone talking about an Open House, they ...
Residing in a structure that the individual owns. ...
Net operating income (NOI) of property relative to its market value. If rental income property worth $1,000,000 results in NOI of $100,000, the overall return is 10%. NOI compared to ...
The selling of a parcel of land whereby the original owner agrees to immediately leaseback the property. The advantage of the land sale-leaseback in that the original property owner can ...
When it comes to the subsurface rights definition, the meaning needs to be defined from the US perspective as these rights are not a default elsewhere on the planet. In general, in the US, ...
Regulation of the Securities and Exchange Commission (SEC) establishing the criteria to avoid a private offering. For example, John wants to sell shares in an apartment house to several ...
Person leaving from work to spend time in leisure activities. pay in full the balance on a debt either at or before the maturity date. Penalties may be assessed on prepaying a mortgage. ...
Have a question or comment?
We're here to help.