Estimated price a property could reasonably achieve in an open market transaction.
Market value is the estimated price a property would likely achieve in an open and competitive market under normal conditions.
Market value sits behind many mortgage conversations, even when the lender talks instead about appraised value. Borrowers often use “market value” loosely, but the concept matters because it informs how much lending the property can support.
An appraiser forms a value opinion using market evidence, often including comparable sales. Market value is not simply whatever a seller hopes to get or whatever a municipality uses for property-tax purposes.
In refinance and home-equity conversations, market value becomes especially important because the lender is not working from a fresh purchase contract and therefore leans more heavily on valuation evidence.
| Often confused with market value | Why it is different |
|---|---|
| Listing price | That is an asking figure, not proof of what buyers actually paid. |
| Owner opinion | Owners may know the property well, but the lending decision still needs evidence. |
| Assessed value | Assessment systems are built for taxation, not transaction-specific underwriting. |
| One headline neighbourhood sale | A single standout sale rarely settles value by itself. |
A homeowner believes the property is worth $1.1 million because a neighbour listed at that price. The lender still wants evidence that the property’s market value supports that figure before approving a larger refinance or HELOC.
Market value is not the same as assessed value.
It is also not simply the current listing price or the owner’s target price. Market value is an evidence-based estimate of likely sale price under normal conditions.
Market value moves with local conditions, property changes, financing conditions, and comparable-sale evidence. In fast-moving markets, yesterday’s assumptions can become stale quickly.