Right about now, a lot of us are getting our Valuation Notices in the mail. These are the letters that the counties send out notifying you of what your County Assessed Value is for the current year. The question we get all the time is; “I just received my assessment from the county, is my home really worth what they are saying?”
The answer is maybe…but probably not. Many of us are seeing values that seem lower than what we think our homes are really worth. Let me explain. In the state of Minnesota by way of state statute, the assessors have to value our properties according to historical sales. They are looking back in time to see what values have been. Not what they are doing today or where we expect them to be in the future (current market conditions).
As an example, the notices we are receiving today providing us with our 2014 assessment are based on historical sales (past sales) from October of 2012 through September of 2013. So, the home that sold next door to you last month is not figured into this equation.
In our current market situation, for a home in Plymouth, the average sales price today is $350,483. But the average sales price back in November of 2012 was $315,225. So an average home in the city of Plymouth will have an assessed value for 2014 of $315,225 while the average home is currently selling for much higher than that at $350,483.
We are currently experiencing an improving market in the Twin Cities, prices are going up, and that is a good thing. Not too long ago, think back to 2007 through 2011, and prices were going down. So assessments often showed values that were not close to what fair market value was, or to put it another way, what a buyer would be willing to pay a seller for their home.
So back to the original question, “is my home really worth what they are saying”? The answer is probably not. If you’re trying to determine what your home is worth today, give your REALTOR® a call…you should have a good one! They will help you determine the fair market value based on what has sold recently, what is currently on the market and what current demand in your neighborhood is.
Having a good REALTOR® is as important as having a good doctor, accountant, lawyer or dentist. In fact, statistics show a good REALTOR® can help you achieve an 18% better return when you go to sell (according to the National Association of REALTORS®).
How do you choose a good REALTOR® you ask…that’s a good question for another blog. In the mean time, give us a call.