When you’re buying or selling a house, you have one question on your mind: what’s this property REALLY worth?
Well, the fair market value tells you exactly how much the property is worth in a perfect world. The home appraiser will examine the home’s features and condition along with its location, comparable properties, and market conditions to determine the fair market value.
This benchmark number definitely comes into play during sale negotiations, but you’ll also encounter it for property taxes, refinancing, or home insurance claims. But sometimes homes sell for more or less than their fair market value.
When buyers are super motivated to get into a particular house, they may be willing to mortgage it for more than the fair market value. Or if a seller wants to sell a property ASAP, they might take a loss and sell it for under the fair market value.
Fair market value isn’t the whole story when it comes to buying or selling a property, but it’s a pretty major part. Got any other questions about fair market value or other real estate terms? Reach out! I would be happy to help!
