What are all the different avenues in which you can get a good estimate of your home value?
Not all home valuation tools are created equal. Putting too much stock in the wrong tools could cost you thousands.
There are usually four different routes to determine your home value. Listed in order of most accurate to least are these:
Fully executed purchase contract.
Third Party certified Appraiser
Realtor Broker Opinion of value (AKA Certified market analysis (CMA))
Online Appraiser estimate tools (EG: Zestimate).
A friend came to me a decade ago and ask me to be their Mortgage loan officer to help them purchase a home they were building. But they first needed to sell their home in a different town where I was not a realtor.
The online appraisal estimate said it was worth $265,000
The agent in their town selling their home listed it for $300,000 after they ran a CMA
They got an offer right at 300,000 for an FHA loan. Everything was going great- until we got the appraisal back.
The appraiser only appraised It for 280,000. They would lose money selling at that price. So their only option was to relist it and not accept FHA loans (conventional loans have different appraisers).
The next day they got an offer for 320,000. They accepted it, but were very nervous. Within the week a new appraiser came and valued It right at contract price. Within 5 days, same house, two different appraisers and a $40,000 difference in opinion. If they would have trusted the online appraisal estimator, could have been a $55,000 difference Even appraisals are not the most accurate way to value a home because it is an art, not a science. I tell my clients on both the buying and selling side "Hope you get an appraiser in a good mood today!"
Just know, if you are buying or selling, at the end of the day what someone is willing to pay for a home is the only true solid value of what your home is- regardless of the other three lower tiers of the pyramid
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