Understanding Home Values

In real estate, the value of a home can be determined in several ways. Key among methods of real estate valuation are:

Replacement Cost:

This is what it would cost you to pay for the land and the improvements if you were to recreate and reconstruct your property under today's economic conditions. This estimate of value is used most by insurance providers for estimating how much to ensure your property.

Income Valuation

This is the value of your property as determined by the income it would produce from operations. This method of valuation is used primarily for income-producing properties.

Comparable Sales Valuation

This is the value of your home as determined by the recent sale price of similar properties. This method of real estate valuation is used by residential real estate agents and appraisers.

HomeSalesStats.com lets you see the sold prices of homes and allows you to determine the approximate comparable sales value of real estate. When you see the Sold Price or Sold Price per square foot of homes, what you're seeing is the value of real estate in your area.

The real estate market today cares little about how much it will cost to rebuild a home, or how much income your home would produce if rented. It cares mostly about the price that similar homes have sold for in your area. This is what determines value by today's standards.

So spend some time in HomeSalesStats.com looking at home sales prices and see how home values in your community are holding up. Better yet, call areal estate consultant for data analysis and interpretation.