"Market Value is referred to as the Price a willing Seller would sell for, and a willing Buyer would buy for, neither being under abnormal pressure".

For example, if there is an urgency to buy on the part of the buyers (because the location is perfect for work) or there is an urgency on the part of the sellers (because they have bought another property firm), the property value can change drastically by several thousands of dollars.

Typically, realtors price a home on the basis of at least 3 'comparables' which are similar properties that have recently sold in your neighbourhood. Adjustments are then made for the distinct features of your home, e.g. age, condition, size and location.

Factors That Do Not Affect Market Value

While we sometimes like to ignore the above reasoning because we have become very attached to our home, for the purposes of understanding, here are 6 factors that do not affect Market Value.

1. What Someone Needs.

The specific equity that a seller needs to extract out of his/her home can be realized if the Market Value factors (as described above) support it, but it is not a factor that is entered into the equation.

2. What Someone Wants.

Similar to the above point, the profit margin a seller wants to extract may be realized if the Market Value factors (as described above) support it, but it is never a factor that is entered into the equation, especially from the buyer's viewpoint.

3.  What Someone Paid For Their Home.  

The original purchase price of a home (say $250,000) will be recouped and then some, if it is a seller's market. But in a buyer's market, getting the original investment back may not necessarily be realized.

4.  What The Neighbours Think.  

Opinions expressed by un-qualified neighbours living in your area, are usually unsupported by facts, and should definitely not be entered into the Market Value equation.

5.  What It Costs To Replace The Upgrades.  

The investment of upgrading a home (e.g. new kitchen, hardwood floors, etc.) may be re-captured in addition to the Market Value of the home. However if these renovations were needed to bring the house up to the Market Value, they may not necessarily be realized. Sellers should understand that buyers may be willing to pay Market Value, but only if the home looks like a "Model Home", similar to those staged by new home builders.

6.  What A Real Estate Agent Says.

Unless supported by facts, it doesn't really matter what an agent may tell you, especially over the phone. He/she may be trying to solicit the sale of your home and will tell you the price you want to hear, just to get the listing. Then, once on the market, you may be very disappointed that your wishes are not being realized.

Thinking About Selling Your Home?

How long it takes to sell your property depends on the competition, your asking price, how well your property shows, current lending rates for buyers, location and timing (whether it's a seller's market or a buyer's market).

Talk to me! Let me provide you with a free Home Market Value Assessment. And then together we will map out a strategy that will protect your investment and address your needs.