Some property estimates may not be accurate and are not an appropriate way to determine the price of a piece of real estate. It is important to note that real estate is valued on a comparison by comparison basis. According to Finance Train, real estate is literally, at the end of the day, just valued by comparing pieces of real estate that have sold around the piece of real estate that you are trying to value.
First, you need to find all the homes that have sold within the past six months within a one-mile radius or within the same subdivision of the home that you are trying to value. You can not value homes that have sold 20 miles down the road because a lot of the value that real estate holds is in its location. So, make sure that you have maybe 10 or 12 homes to compare that sold recently within a one-mile radius.
You need to start weeding properties out, and the first way that you are going to do this is you weed them out by their square footage. In the real state community, 15% of a deviation from the property size that you are looking at is generally an accepted comparison. Start looking at the architectural style of the home and the overall layout; you can not compare a brick rancher to things like a colonial house.
So by the time you have gotten through the square footage, through the bedroom and the bath and through the architectural style, you are probably going to have around two or three properties to compare. These two will give you a better estimate of your property’s value.
This is not legal advice.