Why Do You Need a Real Estate Appraisal?

Anytime you buy or sell real estate, you need a real estate appraisal. The major purpose is to find out how much the property is worth. All lenders require it before a buyer can obtain a mortgage. A real estate appraisal develops an "educated and trained opinion" on the value of the property.

An appraiser differs from an inspector, who is looking for things that need to be corrected, repaired or replaced. Thinks that are required by law to be completed before the property can sell. Though an appraiser will look at some of these same things, they are only interested in developing the value of the property.

The Process

The appraiser looks at each property individually, starting with an objective inspection of the interior and exterior of the home. The appraiser will also drive through the surrounding neighborhood to determine neighborhood characteristics. The appraiser looks for the assets, as well as the detriments, of the property. Gross living space, quality of construction, location, layout, number of bedrooms, and bathrooms are all noted. The lot size, condition of the home and land, central air conditioning, landscaping, number of fireplaces or lack of decks, pool, fencing, recent renovations, amenities provided by the surrounding neighborhood are considered by the real estate appraiser.

Living space is calculated by measuring the outside of the home. It does not include such areas as the garage, porches, shed, and so on. The real estate appraiser usually only considers permanent buildings within the appraisal. Fixtures that can be removed, such as above ground pools, spas, and sheds are not included in the appraisal. The appraiser will interview the homeowner, if available, of any home improvements that are not obvious.

Next, the real estate appraiser analyzes the available market data for your area and the surrounding neighborhood, including current and historical comparable sales. current listed properties and properties under contract for sale. The appraiser gather additional data from a variety of sources like county public records, the local mls, and their own files. the appraiser then compares the subject to other real estate in the subject market.

The information is then analyzed and reconciled to develop an opinion of market value. If you get five differens appraisals, you may receive five different appraisal opinions of value. They should, however, all be within a similar value range. If they are completed within the same timeframe and under similar conditions.

For the highest appraisal possible, real estae sellers should have an inspection and appraisal done before putting the property on the market. First, the inspection in order to make any needed repairs or renovations. Then, the appraisal to ensure you are getting the highest possible for your real estate.