How to Check the Market Value of a House (5 Factors)
Written By Liam Swords
After I bought my first home, I realized I had overpaid by at least $50,000 because I didn’t understand how to verify the market value of my home. Now with over 20 years of experience as a real estate agent, I’m passionate about helping others avoid the costly mistakes I made.
Buying a house is one of the biggest financial decisions you will ever make. Whether you’re a first-time buyer or someone relocating to Ottawa, learning how to check the market value of a house is crucial.
In this guide, we’ll explore factors that affect a home’s value in Ottawa. Our goal is to help you understand the home valuation process and how we help our clients avoid overspending thousands of dollars on a new home.
How to Check the Market Value of a House (5 Factors)
When it comes to determining the market value of a house, many people rely on online tools or outdated listings. While these resources can give a rough estimate, they lack the precision of a professional valuation.
An experienced real estate agent in Ottawa can provide a reliable range of value by analyzing the most up-to-date market data. Our process is streamlined to provide very quick answers, so you don’t need to worry about getting slowed down by seeking professional advice.
Our process starts by identifying 50-75 comparable properties, and then filtering the list based on home resale value factors. We narrow the list down to the 3-5 most similar homes and analyze their most recent sale prices to estimate the value of the home you’re buying or selling.
Here are the five key criteria we use to estimate a home’s value:
1. Location
The location of a home is one of the most significant factors affecting its value. Properties in desirable neighbourhoods, with access to schools, public transit, and amenities, tend to get sold at higher prices.
To assess the value of the house you’re interested in, compare homes in the same neighbourhood or a street or two over. It’s crucial that you only include the nearest homes in your comparison.
You don’t want to compare with homes located more than 5 kilometres or so away, as market conditions can vary significantly from one Ottawa neighbourhood to the next.
2. Age of the Property
The year a home was built impacts its valuation. Compare homes built 5 years prior and 5 years after the property you’re interested in. This ensures you’re evaluating homes with similar materials, construction standards, and features.
For example, if a property was built in 2010, look at homes built between 2005 and 2015. Older homes may require updates, which can influence their market value. For example, don’t compare with a home built in 1973 that might have outdated features like aluminum wiring.
3. Time of Sale
Market trends fluctuate over time, so you’ll want to limit your comparison to properties sold within the last 6–12 months to get a realistic understanding of value.
I recently sold a home in Riverside South that sold for $975,000, but their next-door neighbour sold their property for $1.4 million. Why such a big disparity? The neighbour had sold their house during the COVID-19 pandemic, so the market was very different at that time.
Current events and the passage of time can heavily influence home value, making it essential to only focus on recently sold properties. When putting an offer on a house, understanding recent trends helps ensure you make a fair, yet competitive bid.
4. Style of Property
Make comparisons among properties of the same type as your target home, whether it’s a detached house, semi-detached, townhouse, bungalow, etc. Even within these categories, you should compare a two-story home with other two-stories, bungalows with other bungalows, etc.
Also, watch out for listings that don’t disclose all the information. For example, some listings don’t clarify whether the home is an end unit or row unit. These are the kinds of details a real estate team can help you uncover.
Finally, don’t focus on square footage. This metric is often reported inconsistently (e.g. some listings include basement square footage, some don’t.) In my experience, square footage can skew your assessment and has less to do with home valuation as the type of property does.
5. Features and Benefits
When it comes to valuing a home based on features and benefits, I see many people make mistakes. This is most likely because it’s a more subjective category. In my professional experience, the following features are primarily what determines the price of a house:
- Number of bedrooms
- Number of bathrooms
- Whether there’s an en suite bathroom or not
- Whether the basement is finished or not
- Garage capacity (i.e. single car or double car)
While I always help clients find the features they want in a home, looking at certain features won’t actually help you arrive at an accurate estimation of a home’s value. When evaluating a home’s value, avoid factoring in the following criteria:
- Fireplaces
- Kitchen pantry
- Mudrooms
- Laundry on second floor
How to Know the Value of Your Home
The most important home resale value factors are location, age, time of sale, property style, and core features. While home valuation tools online can provide a starting point for evaluating these criteria, they’re no substitute for an expert realtor’s guidance.
If you’re wondering “what’s the market value of my home?” you can rely on the real estate experts from Liam Swords TEAM to provide a reliable answer. We understand local market trends in Ottawa and can help you get a reliable home valuation.
Additionally, our team has access to real estate documents that provide valuable property information you might not be able to find on your own.
Final Thoughts on Factors That Affect Home Value
Whether you’re selling your home or buying a house, understanding value is key. Relying on data-driven analysis and local expertise ensures you won’t overpay or undersell your property.
With over 20 years of experience helping Ottawa buyers and sellers, our team ensures you won’t make costly mistakes like I did when I bought my first home.
We also have a “Love It or Leave It” program, which means that if you’re not satisfied with your purchase within 12 months, we’ll sell it for free. So if you’re looking at buying a property and are worried that you’re going to overpay for it, please reach out so we can help.
Contact us today for professional assistance with home valuation and understanding the costs associated with buying a house. Let us help you find your dream home in Ottawa!
Liam Swords is an accomplished real estate agent in Ottawa, having sold over 1,000 homes. As the team leader of Liam Swords Team, he combines extensive market knowledge with a commitment to client satisfaction.
