A home appraisal determines the monetary value of your property. It is commonly done to know how much the property will sell or how much tax the owner will pay annually. A home owner can either hire a licensed appraiser or a real estate agent to do the job. Home appraisal is not pre-requisite to selling; however, it plays an important role in determining your selling price.
There are other ways to determine your selling price but having an appraised value available can speed up your selling process. Buyers will feel confident that you are not overpricing your home and will more likely give you an offer. Lenders do not like owning overpriced property, which is why most require an appraisal before they will grant an approval of the buyer’s loan. Buyers with loan approval are the ones who can close the deal.
Home appraisal is different from home inspection. A home inspector educates buyers about the home’s condition and its main components while an appraiser formulates an estimate of the home’s value by weighing its location, proximity to schools and shopping centers, the size of the lot, house structure such as number of bedrooms and bathrooms, recent sales of comparable features, house upgrade, and the like. An appraiser evaluates both the house’s interior and exterior condition. There are multitudes of different variables that determine a home’s value. These include and not limited to house condition, amenities, market trends, and improvement. An outside-inspection is not enough to provide all these information.
A well-kept house certainly has more value than a neglected one. Appraisers will notice a sign of neglect in cracked walls, broken windows, leaked roofs, damaged flooring and chipped paints. Dusty cabinets and trash do not decrease a home’s value but they do deter buyers away during home showings.
While home appraisal is not required, it does provide valuable information to both seller and the buyer.