# How to Calculate a Property's Worth

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Setting an asking price way above what your property is worth is a mistake. A house that's priced 10 percent above the market value will sell much more slowly than one priced within 5 percent. To set your price properly, you must know the fair market value of your home. Fair market value is what it would sell for if both you and the buyer were knowledgeable and wanted to make a deal but weren't desperate. If you have the time and energy, you can make a market appraisal to find out your property's worth.

## Step 1

Record the property's features the way an appraiser would. For a residential home, write down the square footage, the number of bathrooms and bedrooms and special features such as a swimming pool or a geothermal heat pump. Also write down any problems, such as a leaky pipe or unstable stairs.

## Step 2

Find at least three or four houses similar to yours that have sold in the past six months and write down the sale price. If your house is a common builder's model, just talking to people who've recently bought neighboring homes may get you that information. If that doesn't work, you have to do research: Look up county land records, network with real-estate agents or drive around town and talk to owners with a "sold" sign on their house.

## Step 3

Collect detailed information about the homes you've selected and how they compare to yours. If one of the homes is the same basic model as yours but has been modified by the addition of \$10,000 deck, subtract \$10,000 from your sale price. If your house has a \$17,000 add-on to the original model and the other house doesn't, add \$17,000 to the sale price.

## Step 4

Average out the prices of the comparable home sales after you adjust them. If the adjusted prices are \$220,000, \$230,000, \$220,000 and \$205,000, the average is \$218,750. That gives you the rough worth of your property.