What Does a House Appraiser Look For?
Property appraisals are a key factor in buying or selling homes. From the buyer's perspective, the appraised value of property is a key factor in being able to obtain a mortgage. Mortgage lenders will typically not approve a mortgage for more than the appraisal price. If the appraisal comes in lower than the asking price for the home, the mortgage may not get approved, thereby delaying the sale of the property.
What is the value of my property? This is an important question to ask, whether you are buying or selling. A professional property appraiser will provide you with an accurate estimate to determine what is the assessed value of a property.
Appraisals cost several hundred dollars and are usually ordered by the mortgage lender. Mortgage lenders will assign an appraiser to assess the property. The appraisal is one of the costs associated with purchasing a home that the buyer is responsible for, and it is usually part of the fee that the mortgage lender charges. From the seller's perspective, they want to get as high an appraisal as possible to justify their asking price for the home. But what do they look for in a home appraisal? Several factors come into play, but the most important factor is comparable home sales. All other factors stem from comparable home sales. Read on to find out what these factors are so that you will be prepared when the time comes - whether you're a buyer or a seller.
Home Appraisal Checklist
1. Neighborhood Comps
Also called comparable homes in the real estate industry, your home will be compared to other recent sales in the neighborhood. There are several criteria that are used when assessing whether a home could be considered comparable. For instance, it must have a similar number of bedrooms and bathrooms, similar square footage of the house and lot, be in similar condition, and located in the same type of neighborhood. In other words, it must be similar, or comparable.
2. Livable Square Footage
Appraisers will look at the total square footage of the property, as well as individual features such as number of bedrooms, number of bathrooms, the kitchen, dining room, and other features. Added features, such as a garage or basement, will be a plus for the assessed value, although they are not considered part of the livable square footage and will not count as rooms.
3. Exterior Condition
Appraisers will assess the overall condition of the exterior of the house, including the roof, walls, windows, foundation, and landscaping. Since this is a visual inspection, they will not go as in-depth as a property inspector.
4. Interior Condition
Appraisers will evaluate the condition of the interior of the home. They will take note if there is major visible damage, or if there are major malfunctions of systems such as plumbing, electrical, or the HVAC (heating and air conditioning) system.
Appraisers consider several factors when evaluating a home's location, such as the proximity to good schools, shops, entertainment, and parks. If the home has a unique location such as near a noisy highway or on the waterfront, this will also affect its appraised value.
Once you've determined how to find a home's assessed value, you can get a good idea as a seller which factors might add value (such as repairs and upgrades) and which factors you have no control over (such as location and comparable sales). As a buyer, it is important to make an offer that you think will align with the appraisal so that the mortgage will be approved.
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