Market Value vs. Appraised Value

Real estate is truly a numbers game. From the price you list your home at, to the price you’re willing to pay for someone else’s home, to the assessed value of a property, there are a lot of different numbers floating around that need to be considered. But, before you can figure out how to properly leverage an offer, it’s important to understand the values you’re working with.

Most important to understand is the market value vs. the appraised value of homes for sale in Alpine, TX. These two numbers may be similar in nature, but what they represent has a profound effect on how you list a home or what kind of offer you decide to put in on one.

Market Value

Market value is what someone is theoretically willing to pay for a home. It’s usually a number that’s in flux and is greatly affected by market conditions and external factors, such as the price of comparable homes in the area.

Market value is important to understand because it helps homeowners and buyers alike come to a resolution. For example, if the market value of a home is around $300,000, it gives a seller a figure to list their home at, with the expectation that someone would see that value as reasonable. For buyers, it establishes a baseline for what they can expect to get for their money out of comparable homes and can drive bidding.

Appraised Value

Appraised value is what the bank is willing to pay for your home—more specifically, the amount of a mortgage loan they’ll cover. It’s the physical nature of the property in its entirety and the value is assessed in much the same way as market value in terms of looking at exterior variables like location and comparable homes.

Think about our $300,000 house. If that’s the appraised value, a buyer might not be as willing to bid up on it, knowing the bank might ask them for a larger down payment or reject their mortgage application if it exceeds that value. Likewise, a seller might use appraised value to set a more lucrative price point based on what they previously bought the home for years ago.

How One Affects the Other

Market and appraised values often clash. For example, if market value is higher than appraised value, it could mean homeowners have to pay more upfront for their prospective homes. Likewise, if appraised value is lower than market value, it can signal inflation in the market, which leaves sellers feeling great and buyers in a bubble. Both values are important individually and when juxtaposed.

At the end of the day, the price you set for your home for sale in Alpine, TX or the price you’re willing to pay need to both be reflective of market and appraised values. Finding a price point that plays nice with both of these values is the smartest way to facilitate a transaction that’s smooth and free of hassles and headaches for both buyer and seller.

Seven Simple Ways to Boost Your Home’s Value

It’s important to always think about your home as an investment. You put a lot of money into buying one and years later you should be able to sell it for a profit. And while natural real estate appreciation is often enough to drive the value of your home upward over time, it’s also a smart idea to make some upgrades along the way. The more money you put into your home, the more you’ll get out of it when it comes time to list your home for sale in Alpine, TX.

It’s not enough to just funnel money into your living space, however. In order to reap the biggest boon from your investment, it pays to put money into upgrades that will have the highest long-term value and appeal. Take a look at seven simple ways to boost your home’s value and where you should be putting your money for maximum return on investment:

  1. Countertops and cabinets: In spaces like the kitchen and bathroom, countertops and cabinets set the tone. An investment in quartz or other natural stone can dramatically boost the value—both perceived and real—of your home.
  2. Floors: It’s estimated that quality, well-maintained flooring can boost the value of your home by as much as three percent! Natural wood flooring is a clear leader in this area, followed closely by luxury vinyl plank.
  3. Space utilization: Having versatile space in your home is going to raise its appeal and eventual selling price on the market. Why? Because not everyone has the same space demands. A bedroom for you might be a home office for someone else. Keeping spaces versatile means bolstering the appeal of your home with minimal investment.
  4. Efficient installations: The name of the game these days is energy efficiency. You don’t need solar panels affixed to your roof to woo potential homebuyers, but you do need emphasis in other aspects of the home. Energy efficient windows, appliances and even lightbulbs are all valuable ways to boost the dollar figure next to your home’s worth.
  5. Paint: Just about the simplest thing you can do to boost your home’s value and appeal is slapping on a new coat of paint. A good paint job with a tone-neutral color can go a long way towards improving the allure of a space—adding as much as a full percent to your overall home value.
  6. Lighting: Lighting is crucial for comfort and perception in a home. Before you list your home for sale in Alpine, TX, give its perceived value a little bump with the right lighting. Not only can it accent the unique architecture of your home, it’ll also help set the mood and cast light on the nuances of your space.
  7. Fixer-upper items: A well kept home is a happy one, and one that will retain its value for longer. Make yourself a big list of all of the little things you’ve been putting off and get to work fixing or improving them. Each item checked off can add a fraction of a percent back into your home’s value, which adds up fast!

It doesn’t take drastic remodels or major renovations to boost your home’s value. Give some thought to the seven items listed above and see what kind of value you can recoup in your home.

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