The price of real estate at a specific point in time is a moving target, because it's determined by the supply and demand relationship in a shifting market. This means, in the short and medium run, prices do go up and down. 


While prices do tend to go up in the long run, real estate in the aggregate appreciates at roughly the same rate as inflation, and sometimes even remains under inflation.[24][27] In other words, just because the market price of real estate increases, does not mean that it has gained any real value as an asset. This fact becomes apparent when you compare real estate prices to gold - which shows that although prices have more than tripled during certain boom cycles, they have also gone down in significant crashes - which lets you see that real estate has actually lost value compared to 1889, which was itself another low point![25] In other words, prices do go up, but value doesn't necessarily follow.


Price also varies significantly from location to location. And even in an up market, regardless of overall national trends, local effects, recessions and other disasters can lower prices significantly. This is why investors recommend that buyers shouldn't just focus on large scale or national trends - prices vary significantly between provinces/states and even neighboring cities.[26]


Just because the prices are changing, however, doesn't mean they are artificial or easy to manipulate. Contrary to what most people believe, for instance, upgrades and renovations have less impact on the actual value of a property than many anticipate. Yes, a home that shows well may sell fast and fetch top dollar, and in a buyer's market, it may be necessary to make your home spotless in order to sell it. But that doesn't mean spending $30k on a new kitchen will add an exact $30k to your property value.


Yes, renovations and upgrades do count, and they do boost the value of your property, but they don't work exactly like depositing cash in a bank - because the price of your property isn't fixed. While the specific type of renovation matters a lot, on average, the rate of return on a renovation is estimated to be 56% of the cost of the renovation. In other words, if re-doing your roof cost you $10,000, on average, you can sell your home for an additional $15,600.[28] That being said, this price boost wouldn't guarantee the profitability of your property as an investment - what if you sold your home at a $20,000 loss? After all, the price of your home is firstly determined by the market, and only secondarily influenced by its features.


Ultimately, the market value of a property is largely determined by the supply/demand relationship in the market, at times rising faster than income in a growth spurt, and at other times rapidly decreasing through a collapse (boom/bust cycle).[29] While some metrics such as location (which city/neighbourhood it's in) and size (square foot of indoor space) is used by professionals to understand and analyze these prices, such analysis is done post-hoc. In other words, it's not the price per square foot in your area that determines the price, it's the market price of comparable properties that determines the price per square foot.


All that being said, you can still make an attempt to calculate your home's fair market value. In this, you'll need to consider three factors:


1. Tax valuation: Your province/state will value your place at a specific price to calculate your taxes. You should already know this number, and if not, you can usually visit their website or give them a call to find out. While this number is usually lower than the actual market value of your home, it can help to provide a basic guideline, at least as a floor to your pricing.


2. Listing prices: Chances are, there are a number of properties similar to yours that are currently listed. You want to identify these comparable properties ("comps") based on hard variables such as location, the number of rooms, square foot size, and yard size. You should also consider age of property and condition, as older properties or properties that need repair will have lower prices. Unless it's an overheated seller's market, the listing prices will generally be higher than the actual value, but they can still serve as a loose guideline or as a price ceiling.


3. Comparable market analysis: A comparable market analysis (CMA) will estimate the current market value of your property. To calculate a rough CMA, you could find comps that were sold within the past 3 to 6 months, and use their closing prices to determine their price per square foot (divide closing price by square foot), and use that number to determine a price for your property (multiply price per square foot of comparable properties with your square footage). Of course, this data is not publicly available, but your Realtor can provide it to you. 


All experienced listing agents will offer a more comprehensive comparable market analysis to establish your property's estimated value for no cost. It is a good idea to get 3 CMA’s and compare them.


Important: Realtors use CMA’s to attract clients and they’ll always want to present the results to you in person. This is a sales presentation where they attempt to get you to sign a contract for them to list your place for sale. Because they’re trying to win your business, some will tell you what you want to hear (your place is worth more than what the other agent said). That’s why it’s important to check that they provided enough comparable properties that are actually comparable. Don't just accept the CMA because a professional told it to you, ask them to show their work and explain their reasoning, or even ask for the raw data.


Using the tax valuation, asking prices of comparable properties, and closing prices of comparable properties you can have a good idea of the fair market value of your property. Of course, how much you actually get will depend on many other factors such as your timeline and the direction of the market. If you need to sell in a hurry, you may end up getting less than the fair market value. If you have time on your hands or you stumble into a bidding war, you may get significantly more than the fair market value. If you need massive repairs, and you don't have the time to do them, they will lower your price. If there is a job boom in your city and many people just started moving in, you'll likely benefit from it.


In summary: All other factors being equal, you should expect to get the fair market value for your property, which is determined by the market based on the supply/demand relationship in your area.


In the end, the market will determine the value.