What Can Hurt a Home Appraisal?
A home appraisal is the means by which a professional appraiser determines the worth or fair market value of a home. The value is important for home purchases, home sales and mortgage financing.
A home valued on the wrong side of an appraisal (low versus high) can be problematic for a homeowner and a seller. From a cancelled sales agreement to delayed refinancing, a low appraisal can place homeowners, sellers and buyers in an undesirable position.
Knowing what can hurt an appraisal can help homeowners and sellers position themselves to secure the best valuation for their homes.
10 issues that can hurt a home appraisal
There are several issues that can negatively impact a home’s value. Below are 10 of them, and all are weighted differently in the appraisal.
- Poor maintenance
Peeling paint, torn window screens, a leaky roof and a broken patio are not only unsightly but are tell-tale signs of a home in disrepair. Poor maintenance of a home can hurt a home appraisal. Simple issues left unattended can, over time, result in costly fixes or irreparable damage to the home.
- Structural damage
Structural damage is any damage to the structure of a home. The damage may manifest as cracked walls, a cracked foundation or sunken floors. Structural damage, depending on the severity, can make a home unsafe and can negatively impact a home appraisal. The graver the structural problem, the greater the impact on the appraisal.
Adding personal touches to a home makes it your own. However, personalizing the space too much can hurt its appraisal. You may like your retro design, patterned tiles or brightly coloured panel walls, but they may not be as appealing to prospective buyers.
Converting premium space into a bowling room may seem like a good idea today. Five years later, when you decide to sell your home, the conversion may end up hurting your appraisal.
- Fewer bedrooms and bathrooms
A bedroom and bathroom converted to pay homage to your SciFi interests is one less bedroom and bathroom to an appraiser. Having fewer bedrooms and bathrooms than other homes in your neighbourhood can hurt a home appraisal. Homebuyers typically prefer more bedrooms and bathrooms. In most cases, they are a great way to add value to a home.
- Excess clutter and mess
One of the worst things a homeowner can do is fail to appropriately showcase a home’s sterling qualities during an appraisal. Having too much mess and clutter can cause an appraiser to overlook features of the home that could positively contribute to the appraisal.
- An outdated HVAC system
An outdated heating ventilation and air conditioning (HVAC) system is a turnoff for homebuyers. Chances are, homebuyers would prefer not to have to worry about breakdowns or other issues once they take up residence. HVAC systems can be costly to replace, and an obsolete system serves to lower a home’s value.
- Lack of Curb appeal
Curb appeal refers to how a nice home and its immediate surroundings look from the street. A home’s lack of curb appeal can negatively impact an appraisal. Buyers want to see an attractive front yard. Simultaneously, having an attractive yard that may be too high-maintenance may be a turnoff to buyers and be just as injurious to an appraisal.
The location of a home is an important contributor to a home’s value or lack thereof. Homes in a neighbourhood with a high crime rate, poor road conditions, an array of dilapidated buildings and few amenities will be appraised lower than similar homes in a neighbourhood where the reverse is true.
Proximity to power lines, a cemetery or noise pollutants like the airport and railway can also negatively impact a home’s value.
- Market conditions
Home appraisals are impacted by the various conditions that exist in a housing market, including the state of supply and demand of houses. An oversupply of houses in a market with fewer buyers can result in a buyers’ market and lower home appraisals.
- Lack of appropriate comparable homes
An appraiser usually compares a home being sold to homes of similar characteristics in the same neighbourhood to derive its value. If recent sales from which to make comparisons are largely foreclosures and short sales, the result is a reduced home value.
Home appraisals in Vancouver
If you are in need of appraisal services in Vancouver, contact us at Adlaw Appraisals. Our highly trained and experienced appraisers are ready to provide accurate and reliable appraisals with very little turnaround time.