Fair market value is defined as the likely price a ready, willing, and able buyer is willing to pay for a property when:
Determining Property Value
The Market-The market approach is based on the premise that a prudent person will pay no more for a property than it would cost to purchase a comparable substitute.
Competitive Listing and Sale Prices-To form an opinion of value, a Real Estate Professional will analyze current listings and sale prices of similar homes in your area. He or she will consider properties that have recently sold, are currently for sale, or were offered for sale but did not sell. Although none of these properties is identical to yours, only those that have a high degree of similarity are noted in this report.
Comparative Evaluation-A Real Estate Professional can prepare a detailed description of your property and an estimate of the selling price range in today's market. This is known as the comparative or competitive market value of property.
Staying Current with Market Value-Once your property has been listed, a Real Estate Professional will continually collect and review updated information to monitor the offering price. Our observations may include:
The probability of receiving an acceptable offer on your property and completing a sale diminishes significantly when your asking price is higher than the current market value.
Here are the factors that will determine price range: