If you're worried about the hit your property value has taken over the last few years, here's a reason to take heart: Even a rat-infested Seattle alleyway (pictured above) has been valued at $1 million -- and it has a buyer.
A million bucks for that? Well, like anyone who wants to determine property value, you have to look at comparable properties and what they're selling for. And Seattle's alleys have proven to be pretty valuable.
Take Post Alley for instance, a once-dingy side street in Seattle that was transformed into a vibrant public market with a famous Gum Wall art installation. And in October, Amazon bought three Seattle alleys for $10 million as part of its plan to build company headquarters there.
The Seattle City Council agreed to have the city vacate the $1 million alley as part of the Amazon deal, allowing developer Vulcan Real Estate to take it over. There are several other desolate side streets in the city that the Seattle City Council is considering putting up for sale, television station KING 5 reported.
Of course, Vulcan won't just leave the alley filled with garbage and pigeons. "The alley vacation will allow us to create a meandering public galleria," Vulcan spokeswoman Christina Siderius told KING 5. (A rendering of the proposed galleria is above.)
Well, Then, My Home Must Be Worth a Lot, Right?
If a dumpy alley can get this much action, then who knows what your home could be worth. It might be time to start checking in on your property value to see how it's changed over the years. You might be pleasantly surprised. (After all, home prices have been on a slow but steady incline.) If you want to start getting a feel for what your home is worth, here's what to do:
There are several sites on the Internet where you can research your property's value. You might start with AOL Real Estate's Home Value Calculator: Type in your address and an estimated value will pop up. (For some areas of the country, information is not available.) Zillow and Realtor.com also have these calculators.
A cautionary note: It is possible that the estimated value does not reflect recent upgrades or projects that you've done on your home that have increased its value. On most sites, you can alter this information to reflect those, but you can't remove your home from the sites.
Compare Your Home to Comparable Properties
Find other homes in your area that are comparable in square footage, age, amenities and style, and see what they've sold for. Choose homes that have sold recently, as that will give you an idea of what the market value is now. In the past, it was recommended to compare your home to homes that sold in the last three years or so, but because home prices have been much more volatile lately, you might want to whittle that time frame down to a year to six months.
Don't Just Look at Listing Prices
While median listing prices in your area might give you an idea of how you can price your home for sale, they don't necessarily tell you what your home will actually sell for -- which is, of course, it's real value. A licensed Realtor can use a Multiple Listing Service to see how long comparable homes lingered on the market before being sold. If a $350,000 house was on the market for more than six months, it likely sold for much less than that. Don't base your property value on what your neighbors asked for their homes.
Foreclosures Don't Always Have a Huge Impact
If there are a sprinkle of foreclosures in your neighborhood but the vast majority of properties are owner-occupied and in good condition, your property value probably won't be affected too much. But the more foreclosures there are in your neighborhood, the more your property value is going to be dragged down. Check to see how many foreclosures there are near you and how close they are to your property. The closer they are -- say, the house next door is a foreclosure -- the more you'll be affected.