I have spoken of FMV as a cornerstone in our discussions. The fair market value of the property is today’s price at which a knowledgeable buyer and seller can both agree. It is without interference or distress. The transaction is “arms length” and the parties are not related. It is from this neutral the starting point which any adjustments are made.
Looking at comparable sales, we can adjust up for things like a rising market, location, low supply, condition or features like a larger lot, solar panels or a pool. On the other hand, we would adjust down for things like poor location, bad neighbors, repairs, delinquent taxes or aging roof, fences and HVAC systems.
With today’s FMV, we can look forward a reasonable amount of time, say 4-6 months, and project possible values. This however goes both ways. Future elections, rising interest rates and trade uncertainty await us as headwinds in 2020. In times of such uncertainty, any FMV price would have a shorter life span beyond a given date.