You’ll hear a lot of terms thrown around when buying or selling a home, and it’s important to understand each one and how they affect your experience. Real estate assessments are important when buying or selling a home. Here’s why.
What Is a Home Assessment?
You will often hear people use the terms “home assessment,” “real estate assessment” and “tax assessment” interchangeably. They are the same thing. Home assessments are essentially something you have no control over. This determination of value is made by the local city or county government and reported to you annually. They place their assessed value on your home in order to be able to bill you properly for property taxes. Though it’s completed annually, a representative may not actually visit your home in person to assess it., the tax assessors review property data from previous years and may only visit your home if you have added on an addition. In most cases, it is not necessary for anyone to actually enter your home to assess its value; it’s all based on the exterior square footage.
How Are Home Assessments Figured?
First of all, your real estate assessment determines how much you pay in taxes — so that’s pretty important! It’s important to know the assessment value and compare it to your property tax bill to ensure you are paying the correct amount. In normal times, real estate values rise steadily each year.
Within your real estate assessment, it should be broken down into two parts showing the separate values for the land and the structure. The sum of the two gives you your home’s assessed value. Tax assessors either use comparable sales of surrounding homes to come up with your home value or estimate the cost of rebuilding it. The figure is then added to the land value to get your assessed value.
How Are Real Estate Assessments Used?
Real estate assessments are matters of public record and are available to everyone. You can find assessed values of homes in areas you are interested in living by visiting sites like Trulia and Zillow. You need to know as a home buyer, that the assessed value is typically lower than the actual fair market value of a home. It can be significantly lower in some cases. Your offer should not be based upon the real estate assessment; use it only to determine the amount of taxes you could be looking at paying in the future. When you make an offer on a home, it’s best to do so based upon the fair market value instead.
Before selling your home, you should make certain that your assessment is accurate, and when buying a home, accessing the assessment is a useful tool in determining future expenses.
If you’re ready to buy or sell your home in the Northern Virginia area, give me a call! I’ll help you navigate all of the real estate terms, paperwork and searching. And when you list with me, I’ll also stage your home for free when we use your furniture. Make 2017 the year you go for your real estate dreams!