You may run into automated home pricing estimates when searching for property information online. As a home buyer or home seller, you may end up comparing the estimates to the marketing price of a house. It is important to know how they work prior to doing so.
How Automated Home Prices are Calculated
Automated home pricing estimates often extract information from public records. This includes facts such as finished space, bedrooms and bathrooms, and home age. This is placed in a database and processed against predetermined calculations to estimate the market value of a house.
Accuracy of Public Information
People may not realize that public information is not usually up-to-date. Most of the time the information is outdated. It may fail to note recent home improvements. Additionally, it will not list features that could influence property values, such as the condition of different components.
Accuracy of Automated Home Pricing Estimates
Given that public information is not complete, it will naturally be imprecise. Most online tools mention an average margin of error in the fine print. Keep in mind, those margins can be significantly more in your market.
Why You Should Not Depend on Automated Home Pricing Estimates
As a consumer in the real estate market, it will be a mistake to strictly refer to automated home pricing estimates. When selling a home, you could inaccurately price your home and waste critical time. As a home buyer, you could outrage a seller and miss out on your dream home by coming in too low on price. An accurate price range involves a knowledgeable professional evaluating detailed facts from multiple sources and comparing a home to comparable properties that recently closed. This is where your real estate broker comes in. When pricing real estate to sell, he/she can prepare an analysis that justifies a particular price point. As a buyer, your agent may help you figure out a price that positions you for the best opportunity for success, especially in multiple offer situations. Remember the accuracy of automated home pricing estimates in NH noted above when searching on the Internet and connect with a local real estate broker for sound advice.