You’re expecting? Congratulations, there is nothing more exciting! It can be incredibly stressful to be buying a home and having a baby at the same time; that’s why we’ve put together a list of what you should keep in mind during this important time.
Read moreTop Reasons Why A Real Estate Closing Is Delayed
A very common real estate myth that both buyers and sellers often believe is that the closing date in a real estate purchase contract is actually when the closing will occur. However, most dates in a real estate contract are "soft" dates. Since both a buyer and a seller agree to a target closing date in the purchase contract it is great when a closing actually happens on or before that date, but it isn’t always possible.
Read more5 Biggest Home-Buying Fears (and How to Face Them)
It's natural to feel a little apprehensive when making a major purchase, but home buying shouldn't scare you out of your wits.
Buyers’ biggest real estate fears sometimes hold them back from buying — not just around Halloween, but throughout the year. The scary thing is, these fears are sometimes well-founded.
Read more16 Signs It’s Time To Move To A New House
Moving isn’t anyone’s favorite thing to do. Aside from the physical process of shifting everything you own into a new space and/or paying people to do so, there are many other factors to consider, such as budget, location, and (perhaps most importantly) your sanity. But the challenges are worth the struggle if you’ve reached the point where relocation truly is best for you.
Read more6 Things Everyone Should Do When Moving Into a New Home
The papers are signed and the keys are in hand. Here's what you need to know when moving in to a new home. First, change the locks. You really don’t know who else has keys to your home, so change the locks. That ensures you’re the only person who has access.
Read moreConsidering Investing in a Rental Property?
While purchasing a property to rent to others includes many of the same procedures as buying a home for your own, there are also a host of factors–both pro and con–that you should be aware of before considering this investment.
Read moreHow To Shop For Your First House Together
Buying your first home can seem overwhelming. It can be hard to narrow down what you want, figure out what neighborhoods are the best and decide how much to spend – let alone do all of that with another person! It's common to have a fair share of disagreements while house hunting, so I’ve put together a few tips to help you find your dream home while putting your relationship first and not going crazy!
Read moreQuestions to Ask When Purchasing a Waterfront Home
Waterfront homes are naturally appealing to buyers. Who wouldn’t want to live right on the water? But although waterfront homes are of interest to most buyers, not many people are aware of the particular risks and issues that can arise with a waterfront home purchase. When you start looking at waterfront homes, you want to know which questions to ask to make sure you do not make a purchase that you will regret. Here are some questions to ask if you're considering purchasing a waterfront home.
Read moreFive Reasons to Buy an Older Home
We have so many gorgeous older homes here in Mystic! They may not be for everyone, but there is something unique about older homes that many home buyers just can’t resist. Everyone has different things that appeal to them of course, and for many people a brand new house built just for them might be ideal, but if you’ve been thinking about buying an older home these reasons might sound familiar.
History
For some people, there is just something intangibly cool about living in a house that has stood through decades, or even centuries. If you live in a neighborhood or town with a good local library or local historians, you may be lucky enough to find photos of your house from many years ago.
Or maybe your house fits into a particular architectural style of decades past: an ornate Victorian, or a sleek, modern mid-century home. Whatever period your home was built in, for many homeowners there is something satisfying about knowing your home’s story and its place in history.
Room for Creativity
One of the drawbacks of older homes can be that they may need updating or renovation to make them more suitable to our modern lifestyles. But many buyers looking for older homes see this as just more room for creativity! With solid bones and unique architectural features, the prospect of updating an older house to work for your family can be exciting and give you the opportunity to create a truly one-of-a-kind home.
Solid Construction
Standard building materials were just different way back when. Solid wooden doors, hardwood floors and thick plaster walls were the standard before more inexpensive materials (designed to look like the real thing!) became the norm for most builders. Siding was made of real wood, facades featured solid brick or real (often local) stone. If a home from a century ago is being lived in today, you can probably assume it was built to last.
Mature Landscaping
Big shade trees, mature hedges and shrubs, flower gardens that have had a chance to grow and establish themselves – when you buy an older home you’re not just buying a building, you are buying the land it sits on and all of the plants and trees that have been planted over the years. Maybe things are a little overgrown, but with a some pruning you never know what surprises will come popping up in the spring. And even if you have to pull out buckets of wisteria or hack back a rhododendron that’s grown too big, you won’t have to wait years before tiny saplings grow big enough to be shade trees, or for flowering plants to finally fill in sparse-looking beds.
Unique Surprises
Admittedly, some of these may be unwelcome and you should prepare to discover things that may need some upgrades or repairs. But old homes can hold plenty of fascinating little mysteries and surprises, just waiting for you to stumble across them one day. Maybe you discover the wiring for an old servant’s bell, or an old garden statue buried in the yard. It might be a box of mementos forgotten in a corner of the attic, or an old-fashioned tool left in the basement. You won’t know until you move in and start poking around!
The Value Showdown: What is the Difference Between Assessed and Appraised Value?
There are two similar terms that you will come across if you are in the process of buying or selling a home: assessed value and appraised value. Each one attempts to represent the value of a house—and yet it’s unlikely the two numbers will agree. So what does each one mean? And how do they relate to the actual market value of a home?
The main difference between the appraised and assessed value of a home is the purpose each is used for. The assessed value is used solely for local tax purposes, while the appraised value is used during the buying or refinancing of a home.
Let’s look at how each of these numbers is determined and how each may (or may not) be useful to you as a home buyer or seller.
Finding the Assessed Value of a Home
The assessed value, which is sometimes known as the tax value of a home, is usually available on most national real estate websites. You can often look up the assessed value of a specific address on your county or city government’s website. NETROnline provides access to online public records for most states.
Local governments rely on property taxes to pay for the services they offer (schools, roads, etc.). Each homeowner pays a certain percentage of their home’s value in tax. For instance, here in Mystic (Groton side) the mill rate for 2015/2016 is 20.95 for every $100 of assessed value. The higher your assessed value, the more taxes you pay; the rate (20.95) stays the same for everyone. A mill is equal to $1.00 of tax for each $1,000 of assessment. To calculate the property tax, multiply the assessment of the property by the mill rate and divide by 1,000. For example, a property with a assessed value of $50,000 located in a municipality with a mill rate of 20 mills would have a property tax bill of $1,000 per year. Connecticut mill rates can be viewed here.
Assessed Value is Used For Tax Purposes
The assessed value is simply the taxable value of your property. To cover all budgeted expenses for each year, your city or county may change your tax rate. This doesn’t mean your assessed value has changed – it might just mean that instead of 20.95% of your home’s value you now pay 21.4%. Your home’s assessed value only changes during a revaluation. In Connecticut, revaluations are conducted every 5 years.
How Is Assessed Value Determined?
To determine the taxable value of a property, the local tax assessor will look at sales data for nearby houses to arrive at a general market value for the house. The assessor may also take into account income and expense data for income-generating properties, such as rentals. The tax assessor will likely inspect the exterior and interior of your home, although you generally have the right to refuse him access to your house or property (the law on this varies from state to state). Keep in mind that if he is unable to view certain parts of your property, he will have to guess on factors that may result in the assessment (and your tax bill!) being too high. Refusing to allow a tax assessor to enter your home may also jeopardize your ability to appeal the valuation if you feel it is unfair. You can read more about Connecticut's property tax laws here.
Assessed Value v. Market Value
Does the assessed value have anything to do with the actual market value of a home? It depends. Tax assessors factor in many things while making their evaluation, but the process varies depending on where you live. The tax assessor may make his valuation primarily through analyzing past sales of comparable properties, or he may request to see the inside of your home. If he does inspect the interior, he will note any upgrades or damage. If the tax assessor does not see the interior of your home, he may assume certain upgrades have been made, whether they have been or not. Although an assessor uses past sales data in the assessment process, if you live in an area where revaluations are done less frequently, that sales data could be several years old, making the assessed value irrelevant to what you could actually expect to sell your home for today. Buying a house for less than its assessed value doesn’t mean you’re getting a great deal – it just means the house was likely over-valued and the owners have probably been paying too much tax. Buying a house for more than its assessed value doesn’t mean you’re getting a bad deal – it just means the assessment is out-of-date or wasn’t very accurate in the first place (or both).
Appraised Value
So how is the appraised value different? Let’s start with what an appraised value is used for.
You’ve found your dream home, you’ve put in an offer, and the seller has accepted it. Great! Now you need to pay for it. You will go to a mortgage lender and ask them to give you a loan for the sale price of the home, minus any down payment. Before a lender will give you the loan, they want to ensure the home is actually worth what you want to pay for it. The mortgage lender will hire a third-party appraiser to give an estimate of the fair market value of the home. This costs several hundred dollars and is usually paid for by the buyer during closing. If the house appraises for less than the agreed-upon sale price, the lender may be unwilling to give you the loan.
The Appraisal Process
The appraisal process is typically more involved and detail-oriented than a tax assessment. An appraiser will walk through the inside of your home, inspect the exterior, take photos and compile a thorough report including data on comparable properties that have sold recently (ideally within the last six months). The report will include details about the building materials and structure, improvements, and features of the lot. A good appraiser will be familiar with the local market and community, and so should ideally take into account factors like school district, proximity to public transit, parks, local market trends, and so on. Based on their observations and their analysis of comparable properties, the appraiser will give a determination of value. Your lender is required to provide this to you prior to closing so that you have time to review it and decide on a course of action if it comes back too low.
Appraised Value vs. Market Value
Ideally, an appraisal should come in pretty close to the price the seller and buyer have agreed on. This will not always be the case, of course; an appraisal cannot take into account other factors that determine what a house will actually sell for – a highly motivated seller or buyer, a buyer who places value on some aspect of the home that nobody else does, or even a seller’s preference for one buyer over another based on some factor other than price. There are many intangible factors that go into determining the price for which a property ultimately sells. An appraisal attempts to account for as many of these as possible, but still may end up being higher or lower than what the buyer is willing to pay.
Both the appraised and assessed values of a home are simply estimates of the price the homeowners would get if they sold the home. At the end of the day, the only way to determine the actual market value of a home is to put it on the market and see what it sells for. (But don’t just throw it out there and wait – a good real estate agent will help you find the perfect list price!)
Source: mattminordurham.com