This may be an exciting time of your life….you’ve had your home on the market, you’ve accepted an offer and now your home is under contract! Here’s some important information you need to keep in mind about the appraisal process.
A home appraisal is an unbiased estimate of the true (or fair market) value of what a home is worth. All lenders order an appraisal during the mortgage loan process so that there is a way to assess the home’s market value and ensure that the amount of money requested by the borrower is an appropriate number. The appraisal can include recent sales information for similar properties, the current condition of the property, and the location of the property, the appraisal also can include insight as to how the neighborhood impacts the property’s value.
Remember this: appraisers are looking at the condition of what’s permanently part of or attached to the house. They’re not evaluating the décor or furniture or anything that’s not affixed to the property; what’s most important are your home’s physical characteristics (age, square footage, the number of bedrooms and baths, lot size, location, view) as well as their observable condition. Sometimes sellers wonder what they can do to help to add value to their home. If you’re trying to sell your home, there are lots of relatively inexpensive things you can do to improve your home’s appraised value:
- If your bed is not made or there’s a few dirty dishes in the sink, that won’t affect your value, but plaster cracks, water-stained walls, soiled carpeting, pests, or persistent odors might. Patch the walls and do other touch up work to put your best face forward.
- Fix leaky faucets, broken windows and cracked ceilings.
- Check your curb appeal. Overgrown landscaping and broken garage doors will work against you and your appraisal—especially if property values have declined in the neighborhood. Take the time to make the outside of your home look welcoming, like someplace you’d want to buy or visit.
- I cannot emphasize this enough! Itemize your improvements. Jot down the repairs and updates you’ve made over the years, when you did them and how much they cost. Remember the items that an appraiser might not notice, like a new roof or insulation—and even minor items like a new kitchen sink count too. Please remember that improvements do not represent a dollar for dollar increase in value, but every little bit helps!
- Display your neighborhood knowledge. If there have been positive changes to your neighborhood—like new schools or new roads—let the appraiser know.
- Don’t let your home show it’s age. The newer your home appears to be—regardless of its actual age—the better. Bring carpet, tile, windows and other permanent fixtures up to date.
Always remember what an Appraisal is a “snapshot”…..Home prices shift, and appraised values will shift with those market changes. Your home may be appraised at $150,000 today, but in two months when you refinance or list it for sale, the appraised value could be lower or higher depending on how your market has performed, it’s always in your best interests to be aware of what is happening in your local real estate market.
I keep very aware of what is happening in our local real estate market. If you have questions or concerns, remember I am only a phone call / text away at: 573-275-1533 (cell) or 800-532-8385 (office) and ask for Debbie Jennings or RE/MAX Realty Experts.