Home Values & Estimates - What Does it All Mean?

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Real Estate

Assessed Value, Appraised Value, Zestimates and CMA’s – What does it all mean??

By Maryanne Davis, Real Estate Specialist

Vanessa Leonard Group

In real estate a common question is “what is this property worth?” Those who know me, know my standard answer to that question - the property is worth either what someone is willing to pay for it or what a bank is willing to lend you for it. The current situation in real estate has caused the first part of that answer to turn the market on its ear. Our low inventory and steady influx of cash buyers has made that number a difficult one to determine.

That being said, let’s focus on some of the property valuation methods.

Assessed Value

It’s important to know there is a difference between assessed value and appraised value. The assessed value is a property's determined valuation to calculate the appropriate tax rates. Assessed value is determined by the county property appraisers offer.  This differs from an appraised value.  The assessed value is based on what a county determines as the just market value minus exemption limitations such as Save Our Home exemptions. The just value is determined by current market information. The taxable value is the assessed value minus exemptions. This is the value used to calculate the taxes due. 

The Pinellas County Property Appraiser has a website with links to a tax estimator to help determine your taxes after a purchase as well as other helpful information.  https://www.pcpao.org

Appraised Value

Appraised value is mostly used by financial institutions to determine value. Since the bank, or lender, will be using the property for collateral it will most likely require an appraisal to ensure that the property is worth the amount the seller is asking for. A property's appraisal value is an unbiased valuation determined by a professional, licensed qualified appraiser. The valuation is determined by current area home sales, homes with similar properties and by current market trends. The home’s amenities, the number of bedrooms and bathrooms, floor plan functionality, and square footage are also key factors in assessing the home's value. According to federal regulations, appraisers must be unbiased and have no direct or indirect interest in the transaction.

A typical appraisal is done on the Uniform Residential Appraisal Report from Fannie Mae.  Appraisers need to describe interior and exterior condition of the property with a complete analysis and conclusion based on their observations.


The Zillow based estimate, aka Zestimate, is an estimated market value using a proprietary algorithm.  This algorithm uses tax data, user submitted data and physical attributes (number of rooms, square footage, etc). According to Zillow the data is updated 3 times a week and by its own admission there is a margin for error.  Like any artificial intelligence, the results are only as good as the input. The Zestimate does not take into account things like condition of, or upgrades to, a property.  This system only uses historical data not a forward-looking valuation tool. 

As reported by Investopedia “most Zestimates are within 10 percent of the selling price of the home. But Zestimates are only as accurate as the data behind them, so if the number of bedrooms or bathrooms in a home, its square footage, or its lot size are inaccurate on Zillow, the Zestimate will be off.” 


A CMA or a Comparative Market Analysis is prepared by a real estate agent by looking at comparable sales, otherwise known as comps, for recently sold properties similar to the subject home. CMA’s will generally take 3 to 6 properties sold in specific distance from the subject property as well as homes with similar physical attributes such as size, square footage, number of rooms, pool, garage, etc. Other factors to consider would be market trends and availability, differences in subdivisions, etc. This analysis is like the appraisal. The main difference between a CMA and an appraisal is that appraisals need to be conducted by licensed appraisers.

All of these valuation tools are important, but sometimes it all comes down to this simple fact, “A home is worth what someone will pay for it.”