What's My Home Worth?
Why is it Important to Know Your Home's Value
In a 2020 twist, our local Bismarck-Mandan real estate is on fire. Not literally, but if you know anyone trying to buy a home - especially first time home buyers - they are having to work hard. With COVID's effects dropping interest rates to all time lows, the affordability of homes has skyrocketed. This has created upward pressure on housing prices because more people can afford to buy a home than normal. That demand has literally cut our inventory in half. Now with more people trying to buy and less inventory that means most affordable homes end up receiving multiple offers. May the highest bidder win scenarios.
Top 3 Reasons to Know Your Home's Value
A home owner can refinance their home loan to improve the interest rate, pull out cash, or change the length of the loan. Typically a refinance is used to lower a payment or to cut the length of the loan. Cashing out equity - the difference between the value and what you owe - can be used for debt consolidation or purchasing another home.
Most people fall under the first option where they are saving money in monthly payment or interest paid. If you purchased your home with interest rates over 3% - you could be saving money with a refinance.
CAUTION - if you are multiple years into a refinance, lowering the interest rate/refinancing may cost you more! Check with your lender to see if it's worthwhile as a refinance restarts your amortization.
2. Upgrade or Downsize
If you are planning to make a change like stepping up to a larger home or getting out of town, you will need to know what your current home is worth. Unlike a refinance where you buy your house from yourself, there are different fees involved.
Knowing your value PLUS the fees involved in the sale and purchase of your home will set you up for success. That way you don't overshoot your target or give up something you could have had.
3. Estate Planning
If/when you have to help plan for your home or your parent's home, knowing that value is very important. It allows the retiree to plan on what will be affordable for their final move. An added bonus is if the home needs updating or work, you can find out its current value verse its future value if repaired.
This information will help you know how much you will have left over from the sale of the home or to help fund the new place. Also, if it is quicker to sell the home versus repair the home.
When you need to get the market value of your home, you have a few options.
DO NOT USE ZESTIMATES!
Now that we have that covered, a Realtor will be your best bet. A full time agent who is actually buying and selling homes will have the best market knowledge.
As an agent, we can access the data on the MLS to find the most accurate and recent data. Even with that data, a walkthrough or property inspection is a must. We can't see the finishes, the wear and tear, the settling issues and more that may affect the value of the house. If you want the most accurate information, be prepared to let your agent through.
If you are ready for a free home analysis, click HERE. We can pull up your home report or do a customized CMA for you. That way you can plan and prepare for your next steps!
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Let's find you the right home at the right price.