can you really count on home listing price estimates

Can You Really Count on Home Listing Price Estimates?

Buying a new home is an exciting time, and you’re likely scouring through home listing price estimates to determine which houses are in your budget. However, these estimates are not without their flaws. They are often user-submitted and based on market trends, and they may not always be current since they depend on the source of data and when it’s submitted. Instead, they should serve as an idea of how much a house may cost. Learn more about home listing price estimate inaccuracies and how to maneuver the housing market.

Why Estimate?

First, it’s essential to understand that a home listing estimate is not an appraisal. An appraiser will look thoroughly at every aspect of a home to determine its value, and an estimate is exactly that: an educated guess. Real estate websites often look at several factors to estimate a home’s pricing information, such as public records, comparable home sales, and user-submitted data.

Buyers should also be aware that sellers often list their homes at a price they want rather than one the market can support. If similar houses sell for $100,000 in a neighborhood and the seller asks for $350,000, they likely aren’t seeing that. They might also base their numbers on incomplete estimates, leading to home listing price estimate inaccuracies.

So why estimate at all? It gives buyers a ballpark figure of what to expect, and it helps narrow their search. Budgeting is essential in home buying, and estimates will help ensure you only look at homes in your price range. However, remember to keep an open mind and know that estimates are a general guideline, not a rule.

Keep an Eye on the Market

If you’re house hunting for quite a while, update your calculations regularly—the housing market changes with the seasons, and supply and demand ebbs and flow. You can expect a home appraisal to be valid for roughly two to six months, and appraisal numbers lose their accuracy even faster in hot markets where prices change quickly.

However, the reverse is true for home listing price estimates. For example, estimates tend to be more accurate in hot markets since real estate listing websites have more data to utilize. However, markets with little housing turnover might need more information, which causes the home listing price estimate inaccuracies.

Tech vs. Professional

There are two ways to estimate the price of a home: online tools or real estate experts. There are pros and cons to each when determining the value of a home. For example, online calculators are easy, convenient, and quick. They consider your square footage, recent sales history, and other publicly available data, and you receive an estimate in seconds.

However, you can’t top a real estate expert to get an accurate picture of a home’s value. Agents have deep knowledge of the area, local market conditions, and current housing market trends. While technology is fast, real estate agents have that human touch that can’t be duplicated.

A Few More Tips

Remember that home listing price estimates might have yet to learn about recent updates that could impact the home’s value. Also, not all home renovations are equal, and some might not boost the home’s value!

If mistakes are made in the property taxes that have been paid or any exceptions to tax assessments, the home listing estimate will likely be inaccurate.

Look at comparable homes to see what they’ve sold for and how current prices trend.

Find a home financing lender that understands the importance of working with qualified, experienced real estate agents. First Centennial Mortgage knows the power of combining experienced mortgage loan officers with real estate professionals. Contact us today to start your homebuying journey.

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