Natural appreciation
The rise in property value from broader market forces: growing demand, inflation, rising rents. You can't control it, but you can pick markets where it tends to happen.
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Where this comes up: getting ready
Part 1 of 4
Why a seller cares
Natural appreciation is the market lifting your home's value without you doing anything, and it is most of the gain for most sellers. It also stops and reverses, which is what the comps from the last few months are for.
Part 2 of 4
A simple example
You paid $220,000 nine years ago. Nothing changed but the market, and the comps now say $305,000.
| The source of the gain | The number |
|---|---|
| Natural appreciation over nine years | About $85,000 |
| Forced appreciation from a $6,000 refresh | Perhaps $15,000 more at sale |
| A market that has cooled in the last six months | Comps from last year overstate it |
Natural appreciation is the market's gift, and the recent comps say how big it is today.
Part 3 of 4
What people get wrong
That last year's values still hold. Appreciation is measured on the day of sale, and the day of sale can be a slower market.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · drawn from the reference glossary · how we research and check what we publish
In your Room, this word explains itself where it appears.
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