What is meant by the term "market value"?

Market value refers to the estimated amount for which a property should sell in a competitive and open market, allowing both the buyer and seller to act knowledgeably and without undue pressure. This definition emphasizes that market value is not just the price set by the owner or the original purchase price; rather, it reflects the real-world conditions of supply and demand in the marketplace at a given time.

When determining market value, various factors come into play, including the property's location, condition, comparable sales, and prevailing market trends. This makes it a dynamic figure that often changes with market conditions, unlike fixed values such as the original purchase price.

Understanding market value is crucial for real estate transactions, as it helps buyers know what to offer and assists sellers in pricing their property competitively. This comprehension also aids agents and appraisers in providing accurate assessments aligned with current market conditions.