Monday, August 19
One of the most popular questions on BP seem to be about calculating ARV (after repair value) or FMV (fair market value).
So I wanted to post a blog, and I'm sure it's not the first, but want to share what I use and has proven really good for me.
I use multiple sites to get numbers. I essentially throw out really high and really low comps and use the middle numbers. An appraiser years ago taught me how to do comps and calculations.
You need to do a 1 mile or less search radius. Preferably no more than 3 months old if possible especially right now with values changing so fast.
Make sure you compare beds, baths, sq.footage, garage, yard, updates if possible, basement, property conditions and such. You MUST look at all of this to get an accurate Value!! Just because a house is move-in-ready doesn't mean it will bring you the high end price either. If you have two identical houses but one is still decorated from the 70's or 80's and the other is completely updated to current times, the newly updated will bring you much more value and a higher sale price.
After acquiring all your comps, you take the average of them to calculate your ARV of FMV. Now what I do and is a good rule of thumb is if the house is on a main road, then that can hurt the value. If the sq.ft. is good but has less bedrooms than the comps, this can hurt the value. So pay attention to these things and adjust accordingly.
This takes some time, practice, and also trial and error to get a good reliable system down.
Here are the links I use to do all my comp research and have for years. Even before I was active in Real Estate.
101 Beyne St home value estimates on Yahoo! Real Estate.URL This is yahoo homes.
22040 Abrahm St Clinton Township, MI Home Value & Sales Comps at RealEstateABC.URL This is Real Estate ABC
Home Valuation for 18656 Midway Ave, Southfield, MI 48075.URL This is Home Gain but has been down lately for updates
Compare Home Prices | RE/MAX, LLC. This is Remax. Some of the values are close to what you will calculate as your Value and will help in comparisons.
House Value | Estimate Your Home Value at Fifth Third Bank This is 5th 3rd bank and uses Corelogic value estimates as well as gives a few recent sales comps
Real Estate Center | Homepage This is Bank of America. No sales comps but Value estimate sometimes is close to what your calculations will give you after running comps.
Find Real Estate Comps Instantly For Free | Cash Buyer Comps This is Find Comps Now and I recently started using this site and love it. It gives cash sale listings. Lots of comps, owners name, date of purchase. This can be very useful for you. In fact it helped me track down an owner of a property. I cross checked the data with public records and was correct.
So enjoy and please feel free to leave feedback. I would like to know other people's experience with these sites.