What is Market Value?
Market value can be a tricky concept to explain regarding any products. It is not a static figure and depends on a variety of factors that includes timing, urgency, and other abstract concepts. Within real estate, market value is an even more difficult concept to understand. By definition, market value is the price in which a particular house will sell within 30 to 90 days based on its current condition. Based on this definition, market value factors in such disparate issues that are completely unrelated to the property in question such as: the overall real estate market; the type of neighborhood the home is located in; the time of year that the property is on sale; and also how urgently the owner wants to sell their home.
Determining a house’s market value is an inexact science, as the only true way to determine a house’s market value is to look at the figure in which that house is sold for. However, it is possible to make a good estimate of a house’s market value, which is actually the responsibility of a real estate appraiser. Taking in such factors as neighborhood, the house’s condition, the current state of the local real estate market, and other issues, the real estate appraiser is able to produce an educated guess of the house’s true market value. Nevertheless, it is important to remember that the appraisal given is only an opinion and that it is likely that you will sell your home for either higher or lower than the market value given of your home by the real estate appraiser. A good estimate of the market value of your home is important when you are selling your home as it is a figure that you can work with when setting the initial sale price of your house. In order to understand the market value of your house, though, it is important that you analyze the three elements of market value: particular house, current condition, and 30 to 90 days.