Getting a home appraisal can give a buyer or homeowner facts about the value of their real property. An appraiser undergoes training and a licensing process to evaluate real estate. Their opinion is considered the fair-market price. The appraiser is a neutral third party and does not benefit from the final figures.
The appraiser will measure the house’s square footage and break it down into living space and nonliving areas, such as a garage and porch. They will walk the exterior and take photographs of each room, outside, and possibly the street.
To come up with the value, the surrounding neighbors and general location will come into play. The report may point out health and safety issues. Some of these hazardous conditions might be dangling wires or broken windows.
The appraiser will not consider some factors, such as cosmetic issues or colors, so if the interior decorations are not visually appealing, it will not be counted against it. The appraiser has learned to look past personal preferences and focus on details and pertinent facts.
This is different from a home inspection. The report will highlight general conditions, but the appraiser will not check the functionality of the appliances or other components.
To determine the final number, the appraiser must gather more information after leaving the property. Some of the value will be based on past sales of similar properties in the same neighborhood. They will look for the most recent closings and try to find recordings from the past 90 days. In some cases, this is not possible, so older sales will be used and adjusted for market fluctuations.
Currently, listed homes will be crucial also. The appraiser will consider how long they have been on the market and how similar they are to the appraisal subject. The appraiser has studied the local market, so when comparable homes are not exactly the same, the value will be adjusted to handle the variance. Some frequent adjustments are for properties with and without pools and different garage bay counts.
Home appraisals are not just for buyers and sellers, but lending institutions use them to determine the loan value. The courts and estate lawyers may request an evaluation, and government entities may order them also.