When you decide to buy or sell a property in Toronto, you need to have proper knowledge of the most important services you can receive to take your next step right. The most effective factors are knowing your desirable neighborhood better and learning about the Toronto real estate market. Certainly, hiring a professional Toronto real estate agent would be a wise decision, because they have a thorough knowledge of the housing market. But first, do your own homework and learn more about the current market condition and home appraisal in Toronto. This article tries to give you basic information about market analysis and home appraisal.
Whether you are going to buy or sell a Toronto home, you should know about the market analysis. When you learn more, you will be more certain about being in the right direction. However, real estate market analysis may seem to be more useful for home sellers than buyers and home appraisal would be more applicable for home buyers than sellers. Let’s find out more about their meanings and effects on your future real estate transaction.
What does “Home Appraisal” mean?
Home Appraisal means a professional and unbiased third-party assessment of the value of your property in the current market. Many different factors affect this assessment. Some of these factors are the age of your Toronto condo/house, size, its physical condition, amenities, the recent sale prices for comparable properties and so forth. The expertise and experience of home appraisers will easily persuade the lenders and mortgage brokers.
The important tip to mention is that the final sale price is not necessarily the same as the appraised fair market. They are usually different. Generally, your home appraiser should have full knowledge of the neighborhood and offer a completely independent and impartial assessment. So, you better find a licensed professional home appraiser, otherwise, you may overpay for your home. And remember that the role of a home appraiser is completely different from what does a real estate agent do.
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The assessment and final opinion of the home appraiser have an important role in the buying/selling process. Using their opinion, you will know your affordability to get a mortgage and your lender institute can decide how much they can loan you for buying a house. Sometimes, lenders even ask for home appraisal before more negotiation. The assessments of a home appraiser can also help you know if you can refinance your home or not. It is recommended to hire an experienced licensed appraiser who could be fully trusted and perfectly know the area and local market of your Toronot’s property.
What does “Market Analysis” mean?
CMA or Comparative Market Analysis is basically comparing and analyzing the current market values of Toronto properties. Toronto real estate agents use Comparative Market Analysis to help their customers estimate the values of their homes in a more realistic way. Besides, if you have enough time and are eager to do some market analysis, you can start your personal research by creating a comparative market assessment. The first step is to collect the final sale prices for similar houses sold in your neighborhood. In other words, you should be looking for those recently sold houses located within 5-6 kilometers of your house.
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The important point in your analysis is comparing the data of properties with similar size, features and amenities. For example, the comparable sold houses should have the same number of bedrooms and bathrooms or almost similar square footage. However, there are other factors affecting the Toronto real estate market, including supply and demand ratio in your area, seasonality of the market, income and demographics, construction and development costs etc. the entire market analysis process helps you to know how much you should list your house for.
Market analysis should carry less weight than the home appraisal because it is only a subjective estimate of the value of your house. It just gives you a primary idea of how much a potential buyer may pay for your house. But both the home appraisal and the market analysis are important criteria in Toronto real estate transactions.
Before listing your house on the market to sell, you better do all the comparative Toronto market analysis and current market assessments. And as a buyer, you better have a home appraiser as one of the last steps before closing. But generally, both of them influence the evaluation of the approximate amount to pay for a house as a buyer or how much you may get for selling a Toronto condo/house.
Factors affecting the value of your Toronto house
It is almost impossible to precisely determine the lasting value of a Toronto property. Because its value entirely depends on the housing market and your house. Other than neighborhood and location, another important factor to increase your home value before selling is renovation. It is important to give a new and clean face to your house by painting the walls or updating your kitchen a little.
Another important factor is the time of listing your house and the number of similar houses on the local real estate market at the same time. This number may change month by month and part of the home appraisal process is tracking the changes in price levels over time.
The effect of market analysis on the value of your house
There are some annual or monthly reports about Toronto home values and the rising cost of homeownership which are analyzed based on a local and provincial level. You can use these reports to do a better market analysis or use the online estimator tools. But don’t forget that these numbers don’t reflect the actual sale prices of your Toronto condo/house. However, the market analysis offers you useful information about the market condition to take the next step. This will help you to decide whether to put your home on the Toronto real estate market or even buy your first house.
As a Toronto home buyer, you should be aware of real estate market trends. When home values are rising each month, it means there are a lot of similar buyers looking to buy a house at the same time as you. But as a homeowner who wants to sell a house, you don’t need to know much about the provincial or national real estate market trends. The only thing you need is the local reports. So you better know what’s going on in your street or in your condo building which may affect your house value.
As a final word, before you buy/sell a Toronto condo/house you better understand the difference between the home appraisal and the market analysis. You should know when these two can be useful to whom, who can provide such services, who may ask for them, and most importantly how these can be helpful for you. I hope this article could be helpful and wish you the best of luck for your future real estate transaction.
You can easily contact one of the best Toronto real estate agents for any further information.