How to Find Your Home’s Assessed Value
Knowing the assessed value of a house helps homeowners prepare to sell, refinance their mortgage, adjust property taxes, or prepare for a home equity loan with Discover®.
What Is the Assessed Value of a House?
The assessed value of a house is an estimation of your home’s current price. It is prepared by a municipal property assessor and used to calculate property taxes each year.
The assessed value of your home is generally based on a percentage (assessment rate determined by the local county or municipality) of the fair market or home appraisal value of the property.
The true market value is the price your home would sell for in the housing market. It is determined by a real estate agent, or a seller and buyer during the negotiation process. Market value is based on a range of factors, including house size, location, similar properties, market trends, and the condition of the home.
The appraised value is determined by a professional appraiser, who conducts a visual inspection of the home and other appraisal standards. This appraised value can be used for refinancing, home equity loans and comparing to the market value.
If a municipal property assessor deems the market value and appraised value inaccurate, they will use a uniform percentage of each to determine the assessment rate.
There are many resources homeowners can use to find assessed value of property.
How to Find Your Home’s Value
There are many resources homeowners can use to find out property values.
1. Online tools to calculate how much is my home worth?
Homeowners can use a home value estimator tool to learn the value of their house. The digital tools use your address, data from comparable homes in your area, and specific questions about your home, such as features and renovations, to estimate your home’s worth.
2. Get a comparative market analysis
Real estate agents can provide you with a comparative market analysis. This is their estimation of your home’s value based on an evaluation of your property and market trends. This is commonly done before listing a home for sale.
3. Use a house price index calculator
The house price index (HPI) calculator uses data from mortgage transactions over time to estimate the value of a given house. This value is projected based on the purchase price of the home and the changing value of other homes in the area.
The house price index calculator is useful for seeing how much a house has appreciated over time and estimated future changes in mortgage rates.
4. Hire a professional appraiser
You can hire a professional appraiser to assess the appraised value of a house. This appraised value can be used to list the house at an accurate price, refinance, or determine the financial effects of a remodel.
5. Evaluate comparable properties
If you don’t want to pay an appraiser yet, you can research comparable properties in your area to estimate the fair market value of a home. Browse sites with MLS listings to find the prices for homes like yours. Consider square footage, age, condition, outdoor space, amenities, and the number of bedrooms and bathrooms during your research.
How to Calculate Your Home’s Assessed Value
To calculate the assessed value of a home, you need the property’s market value and assessment rate. You can then use this equation:
Assessed value = (Market value x Assessment rate) / 100
If the market value of your home is $300,000 and the assessment rate is 80%, the assessed value is $240,000.
You can also use your property tax bill and the real-estate tax rate of your county to calculate the assessed value of your home with this equation:
Assessed value = (Property tax bill x Tax rate) ✕ 100
If your property tax bill is $2,400 and your county’s department of finance tells you the real-estate tax rate is 1%, you can see that your assessed value is $240,000.
Benefits of Knowing Your Home’s Value
Knowing the value of a home can help homeowners plan their finances more accurately.
If you bought a home for $200,000 and its true market value is now $350,000, your equity has likely increased. You can then use this equity to secure a home equity loan, which can be used to buy a second home, fund a renovation project or consolidate debt. Use the Discover Home Loans Loan Amount Calculator to see how much you can borrow with a home equity loan.
You can also use the new value of your home to calculate your cash-out refinancing options. With cash-out refinancing, you can rewrite your mortgage loan for a larger amount and take that amount in cash. Use the Discover Home Loans Cash-Out Refinance Calculator to input the current market value of your own and learn more about your options.
Comparing Assessed, Appraised, and Fair Market Values
While your home’s assessed value, appraised value, and fair market value may be used interchangeably to evaluate how much your property is worth, they are created by different types of professionals and have different uses. Here’s how to understand the differences between these home value types: