How to Prepare Your Home For An Appraisal

Appraisals A Short Guide

An appraisal of a home is a monetary valuation of a property. An appraisal can be done to determine the fair market value of your home, or what your home should sell for on the open market. Appraisals can also be conducted for tax purposes, such as determining a property’s tax-assessed value, which determines how much property tax the home owner must pay annually. If you plan on buying or refinancing a property, most lenders such as the FHA and VA will require the services of a professional appraiser. As a side note, it is important to recognize the distinction between appraisals and a home inspection. A home inspection specifically outlines the general condition of the property’s structure, utilities, and grounds. A home inspection usually outlines what needs to be repaired in that property. A home inspection does not determine the monetary value of the property, but an appraisal does. An appraisal can be formal and can be conducted by a regulated professional, or they can be informal and conducted by a real estate professional.

When selling your home, an appraisal of the home’s value is a very important step in coming up with a listing price. This service is usually conducted by a real estate sales professional. This type of service is called a comparative market analysis. A comparative market analysis is conducted when a real estate sales professional looks at the price of properties in your neighborhood that have sold with in the last year or two and are similar to your home in size, features, and your property’s condition. These similar properties are called comparable or comps. The real estate sales professional will add or subtract value to your property when considering features that might or might nor be found in the comps. For example, a pool would add value to your home.

 When buying a home, if you decide to make an offer on a property, a lender will require a professional appraisal to be done on the property. By ordering an appraisal, the lender wants to make sure that the property is worth the amount of money that will be loaned out. A professional, independent appraisal is also an opportunity for the buyer to verify that the amount that they have agreed to pay for the purchase of the property is reasonable. This is why many buyers will include a contingency clause in the purchase contact that states that the sale is contingent upon an appraisal.

If you’re an individual who wants to refinance their home, most lenders will require an appraisal to be conducted on the home. The point of the appraisal is to make sure that the value offered by the home will justify the refinanced loan amount that you are asking for.

An appraiser or real estate sales professional will take several things into consideration when determining your home’s value, such as square footage, the number of bedrooms, and the current overall condition of the property. While you won’t be able to increase the square footage or the number of rooms in your home over night, you can make simple improvements to your home that will help your home appraise at a higher value.

 

Start with the outside of your home to make a good first impression

When an appraiser assesses the value of your home, they don’t only base this value on the interior of your home. The exterior of your home is equally important when an appraiser is determining the value of your property. If you ignore the outside of your home, your property will probably appraise for less than it would if you take care of the outside of your home. If your yard is unkempt and the exterior structure needs work, the appraiser might deduct a lot of money from your homes value. It is a great idea to prepare for the appraiser’s visit and clean up the exterior of your property. If possible, fix any loose shutters, replace missing roof shingles or tiles, and power wash the exterior to give the home a sparkling appearance.

Not all improvements are created equally

Kitchens and bathrooms not only help to sell homes, but updating these spaces can add thousands to your property’s value, which is a major benefit if you’re planning on selling or refinancing. We know that that it’s near impossible to renovate your house if you have an appraiser scheduled to visit your home within the next couple of days. However, minor upgrades can go a long way. You can replace things such as dated sinks, light fixtures and faucets. If you can manage, update your kitchen space with newer appliances, updated flooring, and newer countertops.

Clean up the inside of your property

Many people do not realize that a cluttered interior can also effect your property’s monetary value. Experts say that a clutter-free interior can appraise ten percent higher than the same home that has a cluttered interior. It is wise to spend a few days before your appraisal to declutter the inside of your home. This means that you should clean up the inside of your property, including closets, garages, and the basement (if you have one). Another neat trick you can do is to remove large oversized furniture to help give the appearance of more square footage.

Make sure that everything in the house works properly

You can have a lovely home with tons of space, but if anything in the house does not work on the day of your appraisal, your house might appraise at a lower value. It is wise to go through your home and make sure every light switch, outlet, fan, and vent works. If you have visible problems within your home such as cracks or holes in the walls, it’s a good idea to make these repairs before the appraiser comes.

Use a local appraiser

When your lender orders an appraisal of your property, unfortunately they will choose the appraiser. However, often times you can request to have a local professional conduct the appraisal. Ideally, you would want the appraiser to live within a ten to fifteen-mile radius of your property. If the appraiser isn’t familiar with the local area, there is a good chance that the appraisal will come in less than for what your house is actually worth. 

When refinancing a mortgage, a low appraisal can be a death sentence. The lender may decide that you do not have enough equity to qualify for refinancing, which means that you would have to cover the difference out-of-pocket to close the deal. If you want to avoid this situation, prepare for your appraisal by preparing your property. 

Dylan Snyder is a seasoned real estate professional serving the Jupiter real estate market, Palm Beach real estate market, Palm Beach Gardens real estate market, North Palm Beach real estate market, and the surrouding Palm Beach County area. Along with being a top producer in Jupiter real estate, Dylan's professionalism and expertise in luxury and waterfront real estate sets him and his team of real estate experts apart from the competition. For more information on Jupiter and Palm Beach real estate for sale, contact Dylan at (561) 951-9301.

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