Market Value
Definition of "Market value"
When an Appraisal is done, its ultimate goal is to define a Market Value for that property. So, in short, market value is the value of a real estate property in a free competitive market.
Many variables are considered by the Appraiser when analyzing the monetary worth of a property. Supply and demand are the essential factors, but there are others - like structural condition and aesthetic features - that also weigh into the appraiser’s analysis. Sometimes, when a comparative analysis is not enough to assert a price to the house, an Appraiser would use the Replacement Cost and the Income Approach to better evaluate them.
Market Values are not set in stone. Here are three things that can affect it:
- Location, location location. It’s a real estate cliche, right? Because it’s true. A house that is completely identical to another (build-wise) can get sold at a much higher price just because it’s in a premier location.
- Plastic Surgery. You can improve the effective age of your house (and its value) by doing renovations and adding valuable assets to your house. A sauna could not only provide you a good time during the winter, but also bring the market value of your home up.
- Chance. If a trendy retailer sets shop across the street from you, your house may have a spike on its market value. But it could go the other way around too, if - for example - there’s a spike in criminal activity within your area.
The truth is that a comprehensive appraisal keeps an eye on all available information in order to have a clear picture of the property’s value.
Real estate tips:
Find more terms in our real estate Glossary!
And use The OFFICIAL Real Estate Agent Directory® to find an agent for you!
Popular Real Estate Terms
A lease granted for the right to explore for and recover oil and gas on a specific parcel of property. The terms of an oil and gas lease specify the length of time of the contract, the ...
An open surface constructed on top of a flat roof. Normally, a railing is constructed on the sides of a deck roof. See also deck. ...
When we look at title policies, there are different types of coverages offered by title companies. Figuring out which one is the best option in your particular situation often depends on ...
Risk resulting from possible increases or decreases in price levels that can substantially impact real estate values. ...
The legal requirement of a debtor, obligor, to pay a debt and the legal right of a creditor, obligee, to demand satisfaction of a debt or enforce payment in the event of default. ...
Laws enacted by every state governing the activities and requirements of real estate salespeople and brokers. Upon satisfying the necessary age and residency requirements and satisfactorily ...
Structure of prefabricated units. ...
Also called "Grey Shell, "Bare Shell," and "Artic Shell," a Cold Shell could be described as the more radical version of a Vanilla Shell. So, what does precisely the Cold Shell definition ...
Transfer of both real and personal property. An example is the sale of a home with personal belongings. Putting together a group of property to be sold together, perhaps at a discount ...
Have a question or comment?
We're here to help.