How to Calculate the Value of Your Home

Knowing your home’s value helps you determine a list price if you’re selling it. It’s helpful when refinancing and when tapping into the home’s equity, as well.

Keep reading to learn how to calculate your house value.

Are There Online Tools to Calculate a Home’s Value?

You can use online valuation tools to help you calculate your home’s value. Many online lenders and real estate sites offer these tools, which are commonly referred to as automated valuation models. The tools will access online public records relating to your house, including deeds of ownership and tax assessments. Then, using advanced mathematical modeling, the tools calculate your home’s value according to recent sale prices of other homes in the area. Often, current listing prices of other homes are used, as well.

What Is a Competitive Market Analysis?

A competitive market analysis is another excellent way to determine your home’s value. A qualified real estate agent will perform deep analysis to estimate the home’s value, with much of the analysis based on current selling and listing prices of homes in the same and nearby areas. If you’re selling your home, many agents will offer a competitive market analysis for free in hopes that you will hire them as your agent.

What Is the FHFA House Price Index Calculator?

For a more scientific approach to determining your home’s value, you can use the FHFA house price index calculator, also commonly referred to as an HPI calculator. The tool taps into millions of mortgage transactions that have taken place since the 1970s to calculate how much your home is worth. It tracks how much your house has changed in value from one sales transaction to the next. From there, it takes into account market value fluctuations to give its estimate. However, keep in mind that the calculator doesn’t account for inflation.

Get a Professional Appraisal

Many homeowners go the traditional route of getting a professional appraisal to determine the value of their home. Why? Because most lenders require an appraisal before approving a buyer for a mortgage. If you’re wanting to sell your home quickly, having the appraisal out of the way is a great way to accomplish this goal. Still yet, even if you’re not selling, you can always turn to a professional appraiser to perform an appraisal on your home.

Look at Comparable Properties

Lastly, another effective way to calculate how much your home is worth is to perform a comparable analysis. Simply go online and look at homes in your local area that are similar in size and amenities. It’s also important to look for ones that are in the same condition as your home.

Doing a comparable appraisal is often referred to as pulling comps. You are looking at the selling price of comparable properties and then finding the average. For example, let’s assume that you pull comps for these five homes, and the selling price for each home is as follows:

• $200,225
• $189,658
• $215,698
• $195,875
• $202,114

The average between the selling prices is $200,714. This is the value at what you would deem your house being worth.