Author Topic: question about net worth  (Read 3592 times)

kander

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question about net worth
« on: February 03, 2015, 01:32:21 PM »
Hi,

I'm from Holland so excuse me for my bad English (if it's bad, whaha, I don't know, maybe it's just my feeling)

But I have a question about my net worth. I don't know how to put my house in my net worth. We yearly receive a letter  from our city goverment that tells us how much people spent too buy houses like ours in the last year, and unfortunatly that amount becomes lower every year. (Not completely unfortunatly btw, because they also calculate how much we have to pay for city taxes by that number)

But now I want too know: do I have too use that number too calculate my net worht, or do I use the ammount in the appraisal report?? I'm not sure...

Gone Fishing

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Re: question about net worth
« Reply #1 on: February 03, 2015, 01:34:57 PM »
How old is the appraisal?  Generally, a recent appraisal (less than 12 months) is going to be more accurate than a tax assesment.

kander

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Re: question about net worth
« Reply #2 on: February 03, 2015, 01:37:46 PM »
The appraisal is 25 months old.

Some additional information:
Since we've bought the house we have also done some renovations. We have a new kitchen, new bathroom and a woodstove instead of the fireplace that was original in the house.

Gone Fishing

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Re: question about net worth
« Reply #3 on: February 03, 2015, 01:59:11 PM »
If you are just calculating your net worth for personal purposes, just make your best guess!  Even an appraiser can not say for sure.  The only way to really know is to sell it.  If your house is on Zillow.com, it might help you reach a value.  Just don't go crazy and think it is worth 120% of what it really is because a certain house down the road sold for that much.     

ShoulderThingThatGoesUp

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Re: question about net worth
« Reply #4 on: February 03, 2015, 01:59:39 PM »
In the end it's a guess and you don't really know until it gets bought.

Heckler

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Re: question about net worth
« Reply #5 on: February 03, 2015, 03:13:48 PM »
I use value of similar houses in my neighbourhood that just sold.  But really, it doesn't matter until you sell it.

James

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Re: question about net worth
« Reply #6 on: February 03, 2015, 03:30:47 PM »
When I determine the value of my house I guess what it would sell for quickly without improvement or a long time on the market. So how cheap would I have to sell it to move it quickly. Second, I subtract realtor fee and any moving expenses, so maybe 7%? In other words, if I moved out tomorrow and set myself up in a rental, and sold the house quickly using a realtor, how much cash would I get at closing. That is the value of my house in regards to net worth I use. That brings the number down a bit, which I want so that I don't start overestimating my net worth. Eventually I won't be living in our current house, so the top amount somebody might pay for it doesn't matter. I need to know the rough minimum cash I might end up with after selling, closing, and moving somewhere else.
That doesn't mean I won't eventually try to sell without a realtor, and won't try and get top dollar, and make improvements, etc. But those numbers are what I hope to get. For net worth I want a minimum value, not best case scenario.

dividendman

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Re: question about net worth
« Reply #7 on: February 03, 2015, 09:46:49 PM »
I'm from Holland so excuse me for my bad English (if it's bad, whaha, I don't know, maybe it's just my feeling)

Your English is much better than my Dutch :P

It is very easy to understand your English!

CDP45

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Re: question about net worth
« Reply #8 on: February 03, 2015, 09:54:40 PM »
There's more complicated ways to value your home that might give you a sense if comparable sales aren't timely or nearby.

1) how much would it cost to build the house from scratch, in the USA, a basic home is $120-180/sqft including land. More like $100/sq to just build the house.
2) comparable rents - how much could you rent your home for? Is it more than the monthly cost you pay for the home loan and taxes? If yes, your home is probably more valuable than that you bought it for.

3) property taxes are typically inaccurate valuations, typically under valuing the sales price to reduce protests from the inhabitants..

kander

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Re: question about net worth
« Reply #9 on: February 04, 2015, 12:23:29 AM »
Thanks for all the answers. We are not planning on moving, so I guess I'll use the average of the appraisal and the tax assesment. :)