What's Your Home Worth? Why Do You Want to Know?

At some point, every home owner asks the question, “What's my home worth?”

But the ways to answer that question are as varied as the reasons for asking it.

Here are a few home-value estimating techniques, and the scenarios that prompt that question most frequently.

Current Market Value estimate: People want to know what their is home is worth periodically just as people check in on the value of their stock portfolio.

There are as many online opportunities to request a Current Market Value report as there are agents with a website.

And you usually only fill in the bare facts on such sites as bedroom and bathroom count; square foot of living space; lot size; and whether or not you have a pool. Who wants an agent in their house when they don’t even know if they are ready to sell, right?

So you enter all of your data and say, “What’ll my house sell for right now?”

You’ll most likely receive an answer in the form of a range of prices, from low to high. You can then apply your own opinion of how your house stacks up against the homes similar in size and bed/bath count to see where you land within the range provided.

As is vs. Upgraded Value estimate: Many sellers want to know what kind of return they are likely to get from an investment in upgrades to their home. Or asked another way, how much less they will likely get for their house if they sell it the way it is.

This is a tricky area when it comes to the math, but suffice it to say that recent upgrades in the current prevailing style, finish, and fashion will fetch more money than a home with no upgrades, or upgrades done 20 years ago that are no longer in step with the current trends.

Sharpen your pencil.

Highest Current Value estimate: Many times agents are asked to provide an estimate of the highest possible value of a home so owners can evaluate whether or not they can potentially re-finance into a better loan, get rid of the Private Mortgage Insurance (PMI) and pull a little cash out to add a pool.

This exercise often involves really scouring the comparable closed sales to find any little shred of evidence that will justify an increase in the estimated value of the home.

Lowest Current Value estimate: Believe it or not, there are times home owners are trying to justify the lowest possible value of their home. One reason is to contest the value set by the tax assessor and potentially lower your annual property tax bill.

Another reason is in a divorce, when one spouse wants to buy out the other . The spouse wanting to keep the house is looking for evidence to keep the buyout cost as low as possible.

The spouse being bought out will be looking for the highest price possible.

Sometimes both parties submit evidence to their respective attorneys, most likely provided by two different brokers. Then the attorneys duke it out.