As you view home listings and visit some of the houses, you will hopefully find the one you want to buy. Before you purchase it, though, you may wish to assess the home to learn about its value. How do you find out the value of a home before you put in an offer? There are methods you can use to achieve this goal, and here are some of the options you can consider.
Compare the Homes by Price Per Square Foot
If you want to get an idea of the values of homes for sale, calculate the price per square foot. You can do this by dividing the selling price by the square footage of the home. You may want to take this step before you start viewing homes to understand the average price of homes right now per square foot. After doing this, you can have an idea of how much homes are worth based on the average price per square foot.
Compare the Homes to Recently Sold Homes
The second method to use is a comparison of the homes you like to recently sold homes. This process is called a comparative market analysis, and your real estate agent can do this for you. You can understand the going rates of homes right now by comparing a home to others that recently sold. This process is the same process that appraisers use when hired to complete assessments of homes.
Get an Appraisal
While you likely will not order an appraisal of a home until after you put in the offer, you must get one. Your lender will require it, but it can also help you know if you are paying the right price for a home. If you find out through the appraisal that the home is not worth as much as you offered to pay, you can lower your offer. Your original offer should include an appraisal contingency, which allows you to modify the offer if the appraisal is lower than expected. The seller does not have to agree to take a smaller amount for the home, but most sellers will accept lower amounts after the appraisals.
If you would like to buy a single-family home and you want to learn more about what to do, talk to a real estate agent that operates in the area you want to buy a home in to learn more.