What determines your home's value today
Your home's market value right now depends on what a buyer would actually pay for it in your neighborhood, not what you paid for it or what you think it should be worth. That price moves constantly based on three things: what similar homes nearby sold for recently, the condition of your house, and how many buyers are looking in your area right now.
A home worth $300,000 last year might be worth $310,000 or $285,000 today depending on local market shifts, recent sales data, and whether your neighborhood is hot or cooling down. The only way to know your actual current value is to look at real sales—not asking prices, but what people actually paid—and compare them to your house.
Key Takeaways
- Your home's current value is what a buyer would pay today, which changes based on recent sales of similar homes nearby and local market conditions.
- Free online estimates from Zillow, Redfin, and Realtor.com are a starting point but often miss details about your specific house that affect price.
- A professional appraisal from a licensed appraiser costs $300 to $500 and gives you the most accurate number, especially if you need it for a loan or legal reason.
- A real estate agent's comparative market analysis (CMA) is free and based on actual sales data in your area, though the agent's goal is to list your home.
- Your home's assessed value for property taxes is usually much lower than market value and is set by your county assessor, not the real estate market.
Free online estimates and what they actually tell you
Websites like Zillow, Redfin, and Realtor.com show you an estimate called a "Zestimate" (Zillow), "Redfin Estimate," or "Home Value" in seconds. These are built from public records—your home's size, age, lot, and recent sales of nearby homes—but they do not see inside your house. A kitchen renovation, a new roof, or foundation damage will not show up in the algorithm.
These estimates are useful as a ballpark. They tell you whether your neighborhood is moving up or down and how your home compares to others on the block. But they are often off by 5 to 10 percent or more, especially in neighborhoods where homes vary a lot in condition or where sales data is thin. Use them to get a sense of the range, not as your final answer.
To use them: go to Zillow.com, Redfin.com, or Realtor.com, search your address, and look for the estimate. All three let you see recent sales of similar homes in your area, which is often more useful than the estimate itself. Scroll through those comparables to see what actually sold and for how much.
Getting a professional appraisal
A professional appraisal is a formal assessment by a licensed appraiser who visits your home, measures it, photographs it, and compares it to recent sales. This is the gold standard if you need an official number—for a refinance, a home equity loan, estate planning, or a legal dispute. An appraisal typically costs $300 to $500 depending on your home's size and your region.
You can order an appraisal through your bank if you are refinancing, or you can hire one independently through your state's appraiser board or a service like AppraisalHub or ValuationTree. The appraiser will see the condition of your roof, foundation, systems, and finishes—things that move the needle on price. Their report becomes a legal document that lenders and courts will accept.
The downside is cost and time. An appraisal takes one to two weeks to complete. If you just want a rough idea of value, a free estimate or a real estate agent's opinion will get you there faster.
What a real estate agent's market analysis shows you
If you call a real estate agent and ask for a comparative market analysis (CMA), they will pull recent sales of homes like yours in your area and give you a range of what your home might be worth. This is free and based on actual transaction data, not an algorithm. Agents do this work constantly and know the local market in detail.
The catch is that the agent's goal is to list your home, so their estimate may be slightly high to win your business. Still, a CMA from a reputable agent is solid information. You can call two or three agents and compare their analyses to see where the consensus lands. Ask them to show you the comparable sales they used—the actual homes that sold, their prices, and why they are similar to yours.
To get a CMA: search for real estate agents in your area on Zillow or Realtor.com, call three or four, and ask if they offer a free market analysis. Most will come to your home or do it over the phone. You do not have to list with them to get the information.
Why your assessed value is different from market value
Your county assessor sets an assessed value for property tax purposes, and it is almost always lower than what your home would sell for on the market. Assessors use a formula based on your home's size, age, and location—not on recent sales or condition. This number determines your property tax bill, not your home's actual worth.
In some states, assessed values are updated every year. In others, they stay the same for years until you sell or refinance. You can find your assessed value on your property tax bill or your county assessor's website. Do not confuse it with market value. A home worth $400,000 on the market might have an assessed value of $250,000 for tax purposes.
How to use this information to make a decision
If you are thinking about selling, refinancing, or taking out a home equity loan, start with the free online estimates to get a range. Then call two or three real estate agents for a CMA. If you need an official number for a lender or legal reason, order a professional appraisal. Most people do not need an appraisal unless a bank requires it.
Remember that market value is not fixed. It changes with interest rates, local job growth, school ratings, and how many homes are for sale in your area. A number that is true today may shift in three months. If you are planning to sell, get fresh data close to your listing date, not six months in advance.
Factors that change your home's value between now and when you sell
Your home's value today is not what it will be worth when you list it. Market conditions shift. Interest rates go up or down, which changes how many buyers can afford homes. A new highway or a school closure can move prices in your neighborhood. A recession or a local job boom will ripple through home values.
On your own property, a major repair—a roof replacement, foundation work, or a failed septic system—can lower value if you do not fix it. A kitchen or bathroom renovation usually adds value, though not dollar-for-dollar. Deferred maintenance always costs you at sale time. If you are planning to sell in the next year or two, focus on what you can fix cheaply and what you should disclose to buyers rather than trying to predict the market.
Frequently Asked Questions
Is Zillow's estimate accurate?
Zillow's estimate is a starting point, not a final answer. It is often within 5 to 10 percent of actual value, but can be off by much more if your home has unique features, recent upgrades, or if your neighborhood does not have much recent sales data. Use it to see the range, then compare to actual sales of similar homes nearby.
Do I need an appraisal to know my home's value?
No, unless a lender requires it or you need an official number for a legal reason. Free estimates and a real estate agent's analysis will give you a solid ballpark. An appraisal costs money and takes time, so use it only when you have a specific reason to need it.
Can I use my property tax assessed value as my home's market value?
No. Assessed value is set by your county for tax purposes and is usually much lower than what your home would sell for. Market value is what a buyer would actually pay today. They are two different numbers.
What if I get different estimates from different sources?
That is normal. Online estimates, agent analyses, and appraisals can vary because they use different data or methods. If estimates are within 5 to 10 percent of each other, they are probably in the right ballpark. If they are far apart, ask the agent or appraiser why and look at the comparable sales they used.
How often should I check my home's value?
If you are not planning to sell or refinance soon, once a year is enough. If you are actively considering a sale or refinance, get fresh data within a month of when you plan to move forward. Market conditions can shift, so old estimates become less useful.