If you are planning to sell your home, an appraisal can be an important tool.
While looking at property records at your local courthouse can help you to determine the value of your home, it does involve a lot of do it yourself “home work.” The same is true of an electronic appraisal - done online.
However, a home appraisal conducted by a professional can give you the information that you really need. More importantly, having a professional appraisal done will allow you to know the value of your home to prospective buyers (and, you should know that an appraisal will be required by the buyer’s bank as a part of the mortgage loan application).
A home appraisal will be based on the following:
- the size of the home;
- the condition of the home;
- the neighborhood the home is in;
- the value of recent nearby home sales; and
- the proximity of the home to schools, shopping and other services
But the most important information that a home appraisal will give you - especially if you are planning to sell your home with a FSBO listing - is an idea of the right price, the price that will sell your home.
IHS Realty
Determine the value of your home with home appraisals and other tools.
Internet Home Services Real Estate Blog
August 15, 2006 – 4:53 pm
Should it be a deal breaker?
Okay, you find a real estate agent and they help you locate the property you want to buy. A condo, a house, whatever.
You plan to finance 80-90% and put the rest down in cash.
Your real estate agent tells you other homes or condos in the same area have sold for the price you are paying so the appraisal will reflect that.
Okay, you see the realtor has it under control and you don’t make the financing and offer contingent on the appraisal being at or above the price you are paying for the property.
Your lender is only going to loan you the 80-90% based on the appraised value of the home. If that turns out to be less than the price you agreed to pay then you have to come up with more money for a down payment and you are now paying more than the home is worth.
You should always include a financing contingency in the contract that states it depends on the appraisal.
If this happens to you, there is very little you can do unless the real estate agent deliberately falsified the value of the home or condo or the Appraiser did not do a thorough job of evaluating it.
You should examine the Appraiser’s complete report even if they appraised it at the value you agreed to pay for the property. Make sure they actually did a physical walk-through and that all of the assets of the property were included in the appraisal.
You have the right to ask them to reappraise the property if you find descrepencies in the complete report.
See Also
February 23, 2006 – 4:54 pm
How to sell your home when prices start to level off
Reports abound that the real estate market is heading for a slowdown. Depending upon the recent runup in your area, the landing could be hard or soft. Here are some strategies for selling in a level or declining market:
Find a good discount broker - Internet companies now provide services for home sellers that weren’t available just a few years ago. Flat fee MLS listing is now a good option that allows you to keep more of your home equity. Instead of paying a listing commission for inclusion of your property in the Realtor MLS and on Realtor.com, you can pay a flat fee of somewhere between $400 and $500 and get the same exposure as Realtor listed properties.
Get proper pricing assistance - correctly valuing your property is ALWAYS priority #1 when selling your home. Lots of online services provide access to property sales data. You can also get this information yourself with a trip to the local property assessor’s office. If you have a unique or unusual property or have made major upgrades, your best route is a professional appraisal. Although this is a bit more expensive than other alternatives, it truly provides the most accurate valuation. 2 truisms apply: 1) You get what you pay for 2) appraisal isn’t an exact science
