How Much Is My House Worth?

How to determine your home’s value in a choppy market.

It’s a question on many homeowners’ minds these days. After so much turmoil in the housing market over the past few years, what’s left of your home equity?

Maybe you need to sell right away. Perhaps you’re looking to capitalize on low interest rates by refinancing your home or securing a line of credit. Or, like many, you’re just curious about whether your home’s value has taken a serious beating.

Here are several ways to find out:

Free Online Estimates

Free sites like Eppraisal.com offer quick estimates of home values based on analysis of publicly available information, such as tax records. In states where it’s legal to do so, these sites list recent sale prices and satellite photos of nearby homes.

But although these sites can offer helpful hints toward the state of the market, they’re merely a good starting point for your research. “They’re probably worth about what you pay for them,” says Eric Schwartz, MAI, SRA, a professional appraiser of commercial and residential property in Annapolis, Md. “Although I put my own address in one about a year ago and the prices were surprisingly close. These sites will probably get better as they improve their regression analysis.”

Fee-Based Online Appraisals

Some sites, like ElectronicAppraiser.com, offer property valuation reports you can download for a fee. These are computer-generated analyses based on publicly available information, so they may be useful only if you don’t want to spend time looking up records yourself. For example, in the case of a property we checked, the suggested price in the $29.95 Electronic Appraiser report was very close, although not identical, to the local tax assessor’s appraised price.

The report does compile a lot of information into an easy-to-read format: property attributes such as number of bedrooms and baths, recent sales prices, nearby schools and local census information.

Real Estate Comparative Market Analyses

Comparative market analysis, or comps, are reports prepared by real estate professionals that estimate a selling price for your house. They’re based on the agent’s knowledge of the area as well as asking prices and recent sale prices for comparable properties in your neighborhood.

You’ll want comps only if you’re looking to list your house for sale with an agent or broker; they’re not valuable for securing a loan or line of credit. And although some states allow you to ask a real estate agent to prepare a report for a fee when you don’t intend to list with that agent, some don’t, and agents generally don’t like to give away their market expertise without the promise of a commission.

Home Appraisals

A full professional appraisal is a must if you’re applying for a loan and is always going to be the most precise evaluation of your home’s worth. This is especially true if you’ve made substantial improvements that distinguish your house from others in the neighborhood.

“Appraisals go into a lot more detail than a real estate agent doing a comparative market analysis,” Schwartz says. “For example, we measure the house to estimate the square footage, whereas real estate agents typically take it from the tax rolls.”

Schwartz recommends selecting an appraiser with these qualifications:

  • State certification in addition to a license.
  • At least three years’ experience, because the first two years on the job are as a trainee.
  • Membership in a voluntary professional organization, such as the Appraisal Institute (which Schwartz belongs to), and attainment of credentials offered by that organization.

Appraisals of typical subdivision houses will run around $350, Schwartz says, but you can expect a larger fee if your house has special attributes that require extra time on-task or research into comparable prices (like a large acreage or the aforementioned improvements). “The largest fee I’ve ever charged for a house appraisal was $2,500 and that was 15 or 20 years ago,” Schwartz says. “The house was 11,000 square feet, U-shaped, had an indoor swimming pool... I had to spend weeks looking for what might be considered comparable properties.”

Keep in mind that a good appraiser isn’t in a position to profit from the appraisal, and his or her fee will be based purely on time and expertise. “We try to give an accurate, objective picture,” Schwartz says. “I get a flat fee, not a commission.”

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