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Why You Shouldn’t Trust Online Home Value Tools

 

 

By now you are probably nauseatingly familiar with how hot the San Diego real estate market is. In fact, you have probably looked into selling your home to take advantage of the seller’s market.

Just this year, San Diego broke the record for median home price and then did it again. In fact, there are a handful of counties in the United States in which the median home price exceeds $500,000 and, you guessed it, San Diego is in that spot.

Houses are selling like hot cakes from Lemon Grove to La Jolla, from National City to Santee, and from Mission Hills to La Mesa. Every neighborhood is experiencing a surge in home prices and acquisitions and there is no end in sight.

If you are looking to capitalize on these market trends, you’ve probably looked around on Zillow or a similar website. After all, pricing your home is crucial to ensuring a smooth sale – price too high and you’ll get no offers, price too low and you’ll get overwhelmed with offers.

Zillow and other comparable companies are famous for offering online pricing tools. These tools provide a range in valuation for every property in their database, including, very likely, your own home.

These tools are great to get started but they are hardly an end-tool for valuing your home. Most of the time these tools are inaccurate and provide misleading information.

These tools rely on datasets that ultimately do not compare “apples to apples” resulting in skewed or inaccurate price points.

Exploring Historic Home Sales

Zillow and similar tools aggregate historic sales of the home as found on the multiple listing service (MLS), which is a service realtors use to list homes. While historic sales are a great start, they don’t paint a full or accurate picture. For example, MLS sales do not account for the effect of upgrades, remodels, location, or deffered maintenance.

These tools rely on an insufficient number of datasets to accurately value any home. The estimate can give you a good start but ultimately, the value could swing several tens of thousands of dollars in either direction. Use these pricing tools as a place to start, not end in the valuation of your home.

Related: How San Diego Realtors Determine Your Home’s Listing Price

How Much Is Your Home Really Worth?

The most accurate method to ascertain your home’s value is to consider homes that are similar to yours, that were sold in the past three to six months, and are within a mile to half-mile of your home. Let’s break down those elements.

Which Homes Fit a Similar Profile?

Don’t limit “similarity” to bedrooms, bathrooms, and square footage. You need to consider the amenities of your homes.

Do you have a front-yard, back-yard, or side-yard? Does your home have a pool, tool shed, garage (attached or separate), or a car-port? Is your home equipped with the latest fixtures (i.e. recessed lighting, home security system, vaulted ceilings, skylights, biometric door locks, recessed speakers, mood lighting, upgraded electrical or Wi-Fi systems.)

Honestly, that list could go on forever. Consider your remodels and small upgrades. Find homes that match your profile in size, rooms, and amenities.

Which Homes Were Sold Recently?

The San Diego real estate market rapidly shifts in a manner of a few months. You should limit your analysis to homes that were recently sold, which typically means within the past six months. Sometimes you can compare homes sold to a year ago, but that depends on the real estate market specific to your neighborhood.

What is the Market in Your Neighborhood?

You want to compare properties that are close to your home because that is how you account for amenities unconnected to your property.

Your home will be worth more if it is located near amenities like:

  • Public transportation
  • Libraries
  • Parks
  • Restaurants
  • Gyms
  • Hiking

These neighborhood amenities will be shared by your neighbors, therefore comparable homes must be geographically close to your property or you risk getting skewed numbers.

Finding a Good Realtor

Finally, the best way to get an accurate value of your home is to speak with an experienced real estate agent. Real estate agents have the local expertise to delve into the specific sale patterns of your city and neighborhood. A realtor isn’t there to simply list your home and connect you with buyers, a realtor can help you price your home.

Steele San Diego Homes is a dedicated real estate brokerage firm that connects buyers, sellers, and everyone in-between. Steele San Diego Homes offers the latest in technological walkthroughs and tours to provide the maximum flexibility to their clients in an increasingly hectic world. If you need assistance valuing your home, Steele San Diego Homes can help you.

 

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