The value of your home significantly takes into account several components. Home appraisers consider these factors in determining the cost of your property. Understanding how the appraisal process works can be handy whether you are selling or buying a house.
The Key Items in Home Appraisal Checklist To Keep in Mind
What is Home Appraisal and Why It is Important
A home appraisal is a process used to determine the market value of the house. It involves a third-party licensed appraiser evaluating the home and comparing it to similar homes in the area.
Real estate transactions often require appraisals to ensure a fair price for the house. When applying for or refinancing a mortgage, for instance, the lender can offer to lend up to the appraised cost. If the appraisal is low, the buyer may have to find another way to produce the difference to cover the price of the home. In the case of high appraisals, the buyer can borrow the money closer to the agreed-upon sale price.
The appraiser makes a report based on a house inspection, sales trends of similar properties, aspects of the home, and current market trends to determine the property’s appraisal value. A house appraisal could take two days to one week to complete.
What Do Home Appraisers Look For?
Many factors affect house appraisals. These are the following things to keep in mind and how to prepare so you can increase the chance of high appraisals:
Features and Condition of the House
The appraisers typically take note of the general details of the home. These details include materials, the condition of the structure, and the apparent physical aspects such as the design and curb appeal. The size of the property per square footage, the number of bedrooms, and the garage size will also be assessed to settle the house’s value.
The methods and technology used to build the house are also taken into account. For instance, outdated electrical wirings, window styles, roofs, and doors can be costly to maintain, thus degrading the property’s value and affecting the overall cost.
The Location of the House
Location is a significant determiner of the property’s value and is an important factor that appraisers look into. The proximity of the house to important locations will be assed. Is the home located near the amenities such as schools, parks, malls, hospitals, and public transport? Appraisers will also look into whether the property is located in the urban or rural area and will take into consideration the surrounding homes or structures in the neighborhood.
The Age of the House
Newly constructed homes are always valued higher than houses built decades ago. Older houses that were built with dated equipment and materials that may be considered hazardous such as asbestos, lead-based coatings, and volatile organic compounds that cause health problems. However, some older houses can be appraised higher when they are well-maintained and have historical value or are in historic locations.
Signs of Damage and Infestations
Exterior and interior damages cost thousands of dollars to repair. It is the appraisers’ job to look for signs of potential problems such as:
- Damaged roof with ruptures and rusts.
- Electrical issues
- Infestations (termites, roaches, and bugs)
- Plumbing problems and leaks
- Rundowns, stains, or cracks on the surface of walls, floors, and ceilings
- Signs of water contaminations such as molds
House renovations may add value to a home. For instance, a plus is energy-efficient and eco-friendly features and extra installations, such as a fireplace, veranda, or a fence. Appraisers will also look into the upgrades, such as hardwood flooring, heaters and coolers, and new doors and windows.
The Bottom Line
Checking the items on the appraisal list increases your chance of getting a high home appraisal. Doing your research on market conditions and similar properties in your area could help you estimate the value of your property. Furthermore, having a checklist helps you prepare for home improvements and clear up as much as possible to improve the curb appeal before the evaluation.
Do you need help with home appraisals? Let us help you. We are here to make acquiring and selling property easier for you. Wiggins Auctioneers has decades of experience in successful auctions and real estate transactions. Contact us today.