What is the best definition of market price?

Market price is best defined as the price someone paid in an actual transaction. This definition reflects the most concrete measure of value, as it is determined by the real-world exchange of a property between a buyer and a seller. The market price is influenced by various factors, including the negotiations between parties, current market conditions, and the specific circumstances surrounding a property at the time of sale.

Understanding market price is crucial for professionals in the real estate industry, as it provides insight into what buyers are willing to pay in the current market. It can serve as a benchmark for appraisals and future property sales. In essence, it represents the true value of a property as perceived by the market at a specific moment in time.

In contrast, the predicted value of a property does not account for actual transaction data and can vary based on estimates or appraisals. The average estimated value of properties in an area may give a broader sense of market trends but lacks the specificity of an actual sale. Similarly, the listed price of a property might not reflect its actual value, as listings can often be higher than what buyers are willing to pay. Therefore, the definition that emphasizes the real, transactional price provides the most accurate understanding of market dynamics.