What is a Real Estate Appraisal and how does it affect selling your home?
An appraisal determines the market value there by ensuring the lending company isn’t over lending and the buyer is getting the most “bang for the buck”. It is performed by a professional, and is supposed to give an unbiased value.
The appraiser confirms that the property exists and is in livable condition and confirms reported square footage. They check the attic and basement including if they are finished or not, but they don’t count in the square footage. They will verify and appraise the central air and heating. A home with a garage will be more valued than one without.
The overall condition of your home, age, architecture timelessness, and the amount and quality of any upgrades will be assessed. The appraiser will grade permanent features to a home. Removable items are not included in appraised value so don’t worry about updating the furniture nor appliances like dishwashers, refrigerators or freezers. Things that you can do to increase value during an appraisal are patch cracks in the ceiling and walls. Finish paint jobs. Fix broken doors or windows. If you really want to stand out – have the best looking yard in the block! 85% of a buyer’s first impression of a prospective property is made up before they enter the front door.
It’s not just the dwelling being judged, appraisal includes the neighborhood, the location and near-by amenities and businesses. Homes in safer neighborhoods have higher values than high crime areas. Homes with medical facilities, shopping and fuel stations in the proximity typically have more value but if the commercial property is too close it can actually have a negative effect.
Also, the way your home compares to others similar in size, condition, and zip code can affect the value. Appraisers will look at statistics from the last several months of the housing market to determine the demand for a house like yours in the area.
Based on these values, the appraiser will give a final report of the home and land valuation to the mortgage company, insurance company or buyer and can impact the amount of money you get for he sale of you home.
To read more about Real Estate Valuation, visit Investopia.