It is important to know that just like a formal appraisal; a real estate assessment is just someone’s opinion and it should be treated as such. As a home owner you will have to make a conscious effort to not take the assessment too personal, and don’t allow it to hurt your feelings. The intention of the real estate assessment is just to give you an informal benchmark of the approximate value of your home based on other homes in the area.
While informal, a real estate assessment is backed with research. A real estate agent will do what is called a competitive market analysis to come up with his/her real estate assessment. A competitive market analysis will often use tools like a website to search the entire multiple listing service to see what similar houses in your area have recently sold for. Then they can analyze that data to form their real estate assessment for your home. A real estate assessment can be helpful when an individual is considering listing their home for sale. It will give the home owner a starting point of what their home might sell for to determine whether or not it is a good time to sell.
While similar, a real estate assessment is not a formal document like an appraisal. An appraisal is an official opinion that lenders will use to determine whether or not they can use the property in question to secure a mortgage loan. It essentially answers whether a professional third party thinks that the property is worth the amount the buyer is trying to borrow to pay for the property.
While not binding, a real estate assessment can be a very useful tool in evaluating a home’s value. For more information contact a real estate professional.