There are many things to factor in when buying or selling a home and attempting to determine value. The first and short answer is a simple one: a home is worth whatever someone is willing to pay for it. The long answer takes a bit more research.
Zillow is a great place to determine value but possibly not the most accurate way. It will show you when the property was last sold and what it sold for. But, dependent on the market and some other factors, their "Zestimate" is exactly that; an estimate.
So how much is your home or your dream home worth? Can you afford it? Should you sell it? Let's find out.
1. Use Online Valuation Tools
If you simply plug in to Google "How much is my home worth?" you'll see a long list of automated valuation models. Check a few of them out, don't take the first one at its word. Do a bit of digging. Try to be as accurate in the questionnaire as possible. If you're looking to buy a home and are unsure of something, just ask the broker who is handling the property. That's what they're there for.
These sites use public records such as property transfers, deeds of ownership and tax assessments to determine a home's value based on the current market and recently purchased homes in the area.
If you want some more concrete proof of these numbers, the best people to ask are the realtors and brokers as they are the experts here!2. Get a Broker Price Opinion or Competitive Market Analysis
Of course this won't be as detailed as a professional appraisal, but a Broker Price Opinion (BPO) combines an agent's evaluation of the home and the current market.3. Use the FHFA House Price Index Calculator
The Federal Housing Financing Agency's house price index calculator applies a more scientific approach. The FHFA tracks a house's change in value from one sale to the next. Then it uses this information to estimate how values fluctuate in a given market.4. Hire a Professional Appraiser
Short and simple. Lenders require an appraisal before they'll approve a mortgage. So if you're getting serious about a certain property, it could be more than worth the money to get an idea of the home's value.5. Evaluate Comparable Properties
Do a bit of your own digging into comparable properties. The closer you can get to a home that is similar to the one you have your eye on, the closer the value rate will be.