appraisal value of my home | How to assess the market value of a home or property?

 How to assess the market value of a home or property?


We will not hide it, being able to correctly establish the market value of a property is more difficult than it seems. Often, the majority of the population relies on the municipal evaluation and adds tens of thousands of dollars hoping to get a sales price slightly higher than the valuation. This strategy is common, and many sellers use it. However, this is not necessarily a good way to proceed. Being able to accurately and accurately assess the market value of a property is a profession in itself. They are called approved or real estate appraisers. They are real estate appraisers and use proven methods to determine the market value of real estate on specific dates. Since the real estate appraisal process is still more or less well understood today, let me help you see it more clearly. But first of all, you have to understand what the concept of market value is!



1. Definition of market value
1.1. ➟ The Market Value
1.2. ➟ The municipal valuation value
2. What is the concept of real estate value?
3. The Assessment Process for Approved or Residential Evaluators
3.1. ➟ The comparable method
3.2. ➟ The income method
3.3. ➟ The cost method
4. Evaluation by a real estate agent or appraiser: the difference
5. The main online assessment tools
5.1. ➟ Evalweb
5.2. ➟ Grandmont Group
5.3. ➟ Sutton Quebec
5.4. ➟ My Real Estate Broker - Remax
5.5. ➟ Online comparables analysis tool
5.6. ➟ Maplive a Comparative Analysis Tool for your homes or properties for rent
6. How to Self-Assess the Market Value of a Property?


Definition of market value
The market value thus takes the following definition: It is the most likely and sincere price, the actual or presumed sale of a building, at a given date, on a free market and open to competition where the buyer and the seller are reasonably informed of market conditions.

Municipal assessment value: This is the value, on July 1, 18 months before the assessment roll comes into effect, of a building whose value is used for property taxation purposes.
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It is very important to distinguish these two notions of value. Since the appraised value is fixed prior to the coming into force of the roll and does not change for 3 years, changes in the market may affect the value of the building in the meantime. different from that of evaluation. That's why many real estate professionals warn the public not to confuse market value with municipal valuation. It's important to know how to distinguish!



But what is the concept of real estate value?
To understand the concept of real estate value, one must first know the concepts that influence this value. In evaluation, three basic elements interact to give rise to the concept of market value. Here they are :

✓ Utility: The building in question meets a need and satisfies a desire.
✓ Scarcity: The more demands there are for a type of good, the more scarcity there is. Scarcity is an indicator of value gain because supply fails to meet demand.
✓ Purchasing power: This is the basic economic condition.


The interaction between these three elements makes it possible to understand why a monetary value is attributed to a good. In real estate, it can be very difficult to assess the market value of a property without prior training. But how are the evaluators doing it? How is it possible to roughly evaluate the value of a property without having recourse to an appraiser? Let's first look at the first question.  The evaluation process for accredited or residential appraisers
If you ever decide to use the services of a licensed or residential appraiser to determine the market value of your property, it will provide a detailed report in three ways:

✓ The comparable method
✓ The income method
✓ The cost method


Before you begin, the appraiser will gather all the information about your building, your neighborhood and your property to get an overview of your property. Then, he will evaluate your building according to the three approaches in order to obtain three evaluation values. Finally, he will reconcile the value where he will have to make a critical judgment about the value he deems most relevant and present a market value on the valuation date. In the final report, he will have to present the market value at the valuation date, the procedure he used in his three approaches and a justification for the established market value. The person requesting the report will then have a complete and professional documentary evidence objectively testifying to the value of his property.



The comparable method
The comparable method is known to the majority of the population. It is the one that is most often used to quickly assess the value of a building and it is also the easiest to apply. In real estate valuation, this method is considered a direct proof of the value of a property. In fact, it makes it possible to evaluate the fair market value of a property using the real estate market.

Briefly, the method consists in identifying some comparable buildings (3 minimum, 10 maximum) that are very similar to the subject building. The first step is for the appraiser to collect the market data and analyze it to target comparable properties (which have been recently sold) that will be used to establish the value of the subject property. Once these three comparable properties have been chosen (take three as an example), the evaluator will have to adjust the comparables so that their characteristics are identical to that of the subject. For example, if a comparable has a garage and the subject has none, the appraiser will have to calculate the contribution value of a garage and subtract it from the selling price of the comparable property. The main part of the method therefore consists of estimating, from a comparative factor, the contributive value of different property attributes (an extra bedroom, a shower room, a swimming pool, etc.) in order to deduct or add them to the sales prices of the comparables so that they are identical to the subject.

When this is done and all comparables are brought back to the subject, the evaluator can then weight the values ​​obtained in order to obtain a market value for the subject. If ever one of the values ​​of the comparables seems distorted, it is up to the evaluator to exclude it in order to retain only the representative values.

This method is the most tested, used and recognized by courts in Quebec.



The income method
The income method is used to estimate the market value of a property from the net income it generates according to market conditions at the valuation date. It is a more complex method and consists of indirect proof of value. This is a technique used when the building produces income of a real estate nature or when there are few comparable sales in the market. Value must often be corroborated by another valuation method.

Briefly, the method consists in estimating the net income of the building then dividing this amount by a discount rate. The value thus obtained then consists of the market value of the building. This is a very simplified version of the method. The cost method
The cost method is one of the proven evaluation techniques and is considered indirect proof of the market value of a property. This technique is mainly used when there is no active real estate market, for limited-use constructions, for new constructions or for non-standard buildings.

The method consists of evaluating, first of all, the value of the land. Subsequently, the appraiser will calculate the replacement cost at nine of the building and then make a calculation of the depreciations affecting the building according to its apparent age, location and obsolescence. Finally, he will calculate the depreciated value of the building and add the value of the outbuildings (sheds, garage, etc.). He will add the value of the land to that of the building to obtain a final value by the cost method.



Evaluation by a real estate agent or appraiser: the difference
Properly assessing a property is much more complex than it seems. The experience and judgment of the evaluator is critical in establishing market value. Real estate agents, with their knowledge of the real estate market and the few courses they have followed, are able to assess the approximate market value of your property. You wonder then: why would I pay the big price for an appraiser in this case? In fact, it's mainly a matter of precision ...

Becoming a real estate agent requires college-level training (AEC or DEC) in real estate brokerage. During this training, the real estate agent receives courses on various aspects in real estate, including valuation. For its part, the chartered appraiser must complete a bachelor's degree at the university level, do a one-year internship, take the training courses of the Ordre de déontologie to finally pass the admission exam. This is a much longer and more comprehensive course, during which the appraiser specializes in several real estate worlds and where he acquires expertise in real estate valuation.

The difference is that the evaluator, because he has a much more advanced training in evaluation, can evaluate the value of your property with a higher degree of accuracy. Moreover, his title is protected and he gives you a complete and official evaluation report, which the agents do not do.

* Note that it is not necessary to be approved to be an evaluator. There are certified appraisers and others who are not (real estate or residential appraisers).



The main online assessment tools
In addition to agents, there are various websites available to evaluate your property online with just a few clicks. Some real estate agencies do it too, such as Sutton, Remax, Royale Lepage, etc. The principle is that you provide some information about your property (address, type of property, number of bedrooms, number of bathrooms, area, year of construction, etc.) for people to evaluate objectively. These are not automated tools that provide value indicators, but many who receive requests, analyze them, and provide an e-mail response.

These are NOT evaluators (except for this), so you have to be careful with these types of services. Often, real estate agents will value the value of your property. Nevertheless, averaging less than $ 100 and sometimes even free of charge, you can request the valuation of the market value of your property. It's not as reliable and accurate as a true assessment, but it can do the job well if the budget does not allow for the use of a chartered appraiser.

Here are different websites that allow you to rate your property in just a few clicks! Also note that many brokers offer this type of service. Evalweb
Evalweb is a site that provides an online evaluation of your property.
The automated evaluation service is $ 50.
The professional evaluation service is at a cost of $ 350.



Grandmont Group
Groupe Grandmont offers a FREE evaluation of the market value of your property using an online form.



Sutton Quebec
Sutton offers a FREE evaluation service of your property. Just complete an online form to get a price quickly.



My Real Estate Broker - Remax
Remax also offers its own FREE online evaluation service. They can quickly target the value of your property.

You can also use this free comparator to compare 3 proposals from 3 brokers via a quick dynamic form in 2 minutes rather than visiting multiple sites.

All of us real estate agencies and brokers are ready to provide you with FREE and QUICKLY a fairly accurate estimate of the market value of your property. It only takes a few clicks and you're done!



Online comparables analysis tool
JRL offers very in-depth comparables analysis tools online, but are reserved for real estate professionals. For individuals, the options are quite limited. One way to do this is to collect recent comparable sales online, but it is common for sales prices not to be displayed. This is where a broker can help you. The latter, having access to databases reserved for professionals, can help you and provide you with advanced information that is not available online.



Maplive a Comparative Analysis Tool for your homes or properties for rent
However, if you own income properties or if you want to know the prices of neighboring rents, you can consult the Mapliv - Rent site. This site presents all the vacant dwellings currently rented with their price and their exact location. This site combines all the offers on the market and facilitates the comparison of rents, which can help you to identify the good opportunities and the relative value of income properties. In addition, it can save you money and target comparable offers at a better price. It is a tool that can be interesting for landlords and tenants to precisely target the right and potential market rent. How to evaluate the market value of a property?
Many people are wondering how it is possible for them to assess the market value of a building without the need for an appraiser. In fact, to be honest, it's very difficult. If you want to have a precise, objective and fair value, you should consult an accredited appraiser or a residential appraiser. On the other hand, it is possible to establish a more or less precise estimate by resorting to a simplification of the comparable method.

For the residential, this method is the most commonly used. If you want to get an idea of ​​the value of your property, analyze the real estate market in your area. Make the profile of your property by targeting the number of bedrooms, bathroom, living space, the presence of a pool, a garage, etc. Then analyze the history of property sales in your neighborhood and target properties comparable to yours (area, number of rooms, etc.)

Choose at least 4-5 comparable properties. It is important that it is located near your subject property and ideally in the same area. Try to make as little difference as possible with yours. Since you are not trained to make adjustments, you can simply average the value of comparable properties in your chosen sector. The result will give you an idea of ​​the value of your property. It should be noted however that this value will be approximate and that your choice of comparable will have a very big influence on the result obtained.

It is therefore possible to roughly evaluate the value of his property. Nevertheless, it is strongly advised to do business with an accredited appraiser or real estate appraiser to obtain a more accurate and accurate valuation of the market value.