And other frequently asked real estate appraisal questions.
How does a private appraisal benefit me?
Are you looking to buy a home? Sell your home? Refinance your home? Are you thinking of investing in a home renovation? Real estate is a competitive industry. Having a private appraisal can increase your financial understanding and strengthen your position in each of these situations. Knowing the true value of a property is key to making a strong offer to buy a home, developing a justifiable listing price to sell your home, and making reasonable investment decisions for your renovations.
What determines my home’s value?
The short answer is the market. This is composed of similar homes in your area that have recently sold. Those homes are said to be “comparable properties” and establish indicators of your home’s value. An appraisal takes the price those homes sold for and adjusts that price based on different physical characteristics, e.g. size, bed/bathroom count, foundation, and extra features. From there, the data is interpreted and reconciled to develop an opinion of Market Value.
Why is my actual home value different than this one website’s estimate?
Those popular real estate websites that purport to value your home are not always correct. While they have their place, these sites use an “AVM” or Automated Valuation Model. To do this, public data sources like tax records are used to determine your home’s physical characteristics.
If your tax records don’t accurately reflect your home, you will get the wrong value back. Furthermore, these models do not know the condition of your home, the level of renovation, positive or negative view factors, and many other factors to value. The difference in value between an unrenovated home and renovated home in certain areas can literally be hundreds of thousands of dollars, yet these websites have never been in your home to verify its features.
What do I need to do to prepare for the appraisal inspection?
Not much, really. Remember the appraisal is to value the physical structure, not your furniture, laundry, or taste in artwork. Please don’t hire a maid to scrub your home from top to bottom – it’s not necessary. But, if you are in the middle of a renovation and are missing key features of your home like a functioning bathroom or kitchen, or in process of removing a wall, these and similar situations will impact your market value. If this is the case speak with your appraiser to determine what type of appraisal you need.
Request a consultation to discuss your situation and your goals today. https://hendley.consulting/