How to determine fair market value of inherited property?

How to determine fair market value of inherited property?

Determining the fair market value of inherited property can be a complex and crucial task. The fair market value refers to the price that the property would sell for on the open market. It is important to accurately determine this value for tax purposes, insurance coverage, and potential sale of the property. Here are some steps to help you determine the fair market value of inherited property:

1. **Get a professional appraisal:** One of the most reliable ways to determine the fair market value of inherited property is to hire a professional appraiser. An appraiser will consider factors such as the condition of the property, its location, recent sales of similar properties in the area, and any unique features that could affect its value.

2. **Research recent sales:** Another way to determine the fair market value of inherited property is to research recent sales of similar properties in the area. You can use websites like Zillow or consult with a real estate agent to get an idea of what similar properties are selling for.

3. **Consider the condition of the property:** The condition of the inherited property will also affect its fair market value. If the property is in need of major repairs or updates, its value may be lower than a similar property in good condition.

4. **Take into account any unique features:** Unique features of the inherited property, such as a waterfront location or historical significance, can also impact its fair market value. Be sure to consider these factors when determining the value of the property.

5. **Consult with a real estate agent:** A real estate agent can provide valuable insight into the fair market value of inherited property. They have knowledge of the local market trends and can help you determine the most accurate value for the property.

6. **Consider hiring a property assessor:** Property assessors specialize in determining the value of real estate. They can provide a professional opinion on the fair market value of inherited property based on their assessment of the property.

7. **Get multiple opinions:** It can be beneficial to get multiple opinions on the fair market value of inherited property. This can help you ensure that you are getting an accurate valuation of the property.

8. **Keep tax implications in mind:** The fair market value of inherited property can have tax implications, so it is important to accurately determine this value for tax purposes. Consult with a tax professional to understand how the value of the property will impact your taxes.

9. **Consider potential sales in the future:** If you are considering selling the inherited property in the future, it is important to accurately determine its fair market value now. This can help you set a realistic asking price and attract potential buyers.

10. **Document your research:** Keep detailed records of the research you conducted to determine the fair market value of inherited property. This documentation can be useful for tax purposes or if you decide to sell the property in the future.

11. **Compare with similar properties:** Compare the fair market value of inherited property with similar properties in the area. This can give you a better understanding of how the property stacks up against others on the market.

12. **Consider hiring a real estate attorney:** A real estate attorney can provide legal guidance on the fair market value of inherited property and ensure that all necessary steps are taken to accurately determine the value of the property.

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