In the real estate world, an appraisal is the estimated valuation of your property done from a professional appraiser. Appraisals are done for two reasons:
- Tax purposes
- For selling purposes, when you want to determine how high you can put your house on the market for.
There are a lot of misconceptions about appraisals that first-time buyers or sellers have, as it is a phrase not common to everyone. In this article, I will go over some of the key ones and clear any doubts you may have about the whole issue.
- Home Inspection Vs Appraisals
A home appraisal gives you a value of your property, while a home inspection tells you about its condition.
Many people believe that if you have had a home inspection, you no longer need an appraisal done. However, this is not the case. In a lot of situations, a home appraisal is actually required to sell your house, while a home inspection is not.
If the potential buyer of your property is hoping to get finance, having an appraisal is especially important. This is why it is best to have one before you put your home on the market.
- Appraisers Aren’t Different
To be an appraiser, you must be state licensed. However, that does not mean all appraisers are the same because they all have been approved by the state. Just like in all other professions, a person’s expertise and experience can vary.
When you are looking for an appraiser for your property, the best thing to do to ensure your real estate is valued correctly, is find an appraiser who has worked on similar properties to yours.
- Improving my House will Increase my Home Value
You cannot expect every one of your home improvements to give you a return. Sometimes, if you do too much to your real estate, expecting it to raise the end value of the home, and it does not match the rest of the community’s estates, the improvements will be called ‘excessive’ and not add to your appraised value at all. All you will be doing is spending money and not gaining a profit.
If you are looking for ways to increase your appraisal value, some repairs to consider are, attic insulation, garage door and front door replacements, and small kitchen remodels.
- The Appraised Value is less than my List Value
If this is the case, and you believe your appraiser has made a mistake, the best thing to do is request for the appraiser’s report of your home, and go through it with a professional real estate agent or even ask for a second opinion from another appraiser.
However, you should never write it off and leave the list price the same, as it could cause issues in the future if your buyer asks for the appraised value. Remember that appraisers are highly paid professionals, so their predictions are usually accurate.
So here you have it! Why appraisals are so important. We hope the information here was helpful to your research.
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