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Understanding Property Values and Appraisals
Whenever a home or property is going to be sold the seller and any prospective buyers would be well advised to have it appraised. Of course that does not mean that a formal appraiser must be called to make an assessment, but this is not a bad idea. If that is impossible the property owner can determine the value within a reasonably accurate figure themselves.
Regardless of which method for appraisal is used, however, the home should first be honestly assessed for any deficiencies or needs. What does this mean? Generally it means taking a very hard look at the entire property to see if some basic repairs can be done that will increase the value, or at least that will spare the appraisal from any negative marks. This could mean re-hanging loose or broken gutters, repairing the roof or chimney, replacing older screen doors that have become warped or which have lost their screening and replacing interior fixtures and fittings that are leaky, stained or damaged.
After doing this work the owner can do the exact same thing the professional appraiser will do – compare their home to those that have recently sold in the area. They should look only at properties with the same square footage, number of baths and bedrooms and equal amenities. This will give an accurate picture of what buyers are willing to pay for homes of the same size and condition.
What are the amenities? This is where a professional appraiser will be able to assign a more realistic value to any “extras” the home or property might have to offer to a buyer. For example, homes with garages, gardens, swimming pools, views, upgraded appliances and cabinetry, luxury building materials and security or fire alarms will all have a bit more value than a less feature-rich property. While a homeowner might know what they paid for such things, only the professional appraiser will know their actual market value.
An appraiser will produce a very realistic market price based on many factors that a homeowner will not know how to calculate. For example, in a single neighborhood, two homes with the same square footage and room count might be appraised at dramatically different amounts and this could be due to the fact that one was built years earlier, or that it has a deteriorated interior or any number of factors, but all such issues will affect the value of the property. Additionally, having a professional appraisal can really provide a seller with the confidence to negotiate strongly with potential buyers.