There are web sites on the internet that have home values on them and of course there are the county tax records that have a value. An appraiser can come up with a value that is different than any of the values found on the interent.
Realtors have a special program that gives us information and a value for every property in the country in fact we have more than one program that will do that. For the chart below I used “RPR” Realtor property resource and a Zillow Zestimate to get a value for my own home. RPR shows some incredible ups and downs.
In both systems the size of the home and the number of rooms are inaccurate. Property values generally don’t have the steep ups and downs over short periods of time as shown on the chart. In less than a year the value went from 75K to 237K that couldn’t happen unless there was a $162K remodeling job.
The Zillow Zestimate is wrong and based on inaccurate information. I would expect my home to sell for more than the Zestimate but less than the numbers in RPR.
To date I have not seen any software that give accurate home values. The way we figure out how much a home is worth is by finding three comparable homes in the immediate area that have sold in the last year. Realtors and appraisers use the same methodology and it is part science and part art. When there are no comparable sales most appraisers will give the lowest value they can come up with.
Before your Realtor lists your home he or she should go over some numbers with you and show you how much comparable homes sold for and make a recommendation on a price. In most cases sellers get less money for their home than what it was listed for.
An appraisal is needed to borrow money to pay for a home because banks require them. I think appraisers have done their part to keep home values low. A few years ago when home prices were going up it seemed like homes would be appraised at what ever buyers offered for them.