When selling or purchasing a property, you may have to go through a home appraisal process, which can surely be nerve-racking, especially as a seller. You certainly don’t want to reopen price negotiations after the home appraisal process and further delay selling your home.
To make it easier for you, you can obviously contact a professional real estate company that sells houses, and they will estimate the right selling price for your home.
Knowing what real estate appraisal is and how it works can put your nerves at ease, which is why we will be discussing all the details in this article.
What Is a Home Appraisal?
A licensed appraiser thoroughly inspects a home from the inside as well as the outside to determine its true value, which is then added to a report.
This especially comes in handy when a buyer is purchasing the property using a loan, and the lender wants to make sure it’s not paying more than the property’s value.
Even for a cash-only offer, a third party may still want to confirm the true worth of the property to confirm or complicate the deal.
The buyer generally pays the cost of a home appraisal since it’s a lender’s requirement. However, for a private home appraisal, the person who ordered the appraisal will be required to pay for the cost.
How Does a Real Estate Appraisal Work?
Right after the buyer and the seller make a deal on the price, the appraisal process will get started to allow enough time for the process as well as the production of the report.
Once the lender opts for a home appraiser, they will get in touch with the seller to set a particular date and time for inspection.
The appraiser will visit the property individually. If the seller is still residing in the house, they may also be present. However, it’s not common for the buyer to be present during the inspection, but you can still request.
The appraiser will start inspecting the property from the inside and the outside to ensure its structural integrity and may also take some pictures. They will also confirm the safety of the property, how many rooms it has, and if it has ever been renovated.
Once the appraiser is done with the process, they will research the market, the neighborhood, and properties situated in it similar to the house they appraised.
This allows them to determine the true worth of the property. They may also go through real estate databases and government records to ascertain the property’s value.
The appraiser may take a sales-based or cost-based approach to determine the value of your house. For a sales-based approach, they may compare the sales value of a similar property.
On the other hand, a cost-based approach combines the value of the land and the cost that would be required to construct the same house today.
How Can Sellers Get the Maximum Appraisal Value for Their Home?
Here are some tips to improve your property’s value.
- Tour your house to assess if anything requires minor fixes and get done with them.
- Crank up the curb appeal by cleaning the lawn, fixing broken door handles, adding modern lighting, or planting new flowers/plants.
- Make sure to deep condition your house before the appraiser visits.
- Minor cosmetic upgrades such as a fresh coat of paint and upgrading to new fixtures can also be helpful.