What Do Home Appraisers Look For In A House?
A home appraiser is a professional tasked with estimating the market value of a house for a variety of purposes including real estate transactions, mortgage financing, estate, tax purposes, marketing listing purposes, and litigation. This task is especially important to mortgage lenders for the management of risks in the provision of mortgage financing to home buyers and refinancing to homeowners.
To determine the house’s value, the appraiser conducts an on-site inspection, evaluates its external and internal features and makes a comparison to recent and comparable sales.
Comparable sales are recently sold homes of similar location, size, age, condition and features in the same area as the home you are buying or selling. Comps are used as a baseline for property value and must be as near to identical as possible to the home being bought or sold, to ensure an accurate appraisal.
An appraiser is not a home inspector, and therefore, does not comment on the integrity of the foundation, roof systems or mechanical systems, and does not check for moisture issues or potential environmental concerns.
An appraiser’s findings are presented in an appraisal report.
Site Influences Evaluated
An appraiser is responsible for observing and documenting any positive or negative site influences. This can include lot shape, lot topography, positive views such as water, mountains, or valleys and negative views such as powerlines, industrial facilities or cemetery, or traffic noise, often referred to as traffic pollution.
In addition to the immediate exterior, the appraiser observes whether the house is situated in an urban, suburban or rural area and the type of neighbourhood.
Home improvements are described in terms of their age, the extent of the work, room allocation, quality of construction and the current condition. An experienced appraiser can differentiate the varying quality of work and will comment on the construction, calling it fair, average, good, or custom. The appraiser will document the type and quality of finishings and improvements such as flooring, windows, mechanical work, cabinets and countertops. It is important the appraiser appropriately categorize the improvements so he or she can accurately compare the subject property to the recent comparable sales and ensure the final estimate of value is accurate and well supported.
Features not included in a home’s valuation
In the valuation, the appraiser does not include the home’s décor or any features that can readily be removed from the home, such as an energy-efficient microwave or a new smart range. Bear in mind, though, that while features of a home’s décor such as energy-saving appliances, do little to increase its value, they certainly add to the home’s marketability.
Prepare for an appraisal
A low appraisal can prevent a sale from moving forward. It is, therefore, in the seller’s best interest to ensure the home is appraisal-ready. Here are a few ways to do so:
De-clutter and clean
While a clean house does not directly impact its value, it can impact the presentation of the features that do. A clean and clutter-free home makes it easier for home appraisers to view features that contribute to the value of the home.
Complete prolonged or unfinished repairs
Peeling paint, leaky faucets and broken porches all detract from a home’s value. Identify and complete unfinished repairs ahead of the appraisal.
List upgrades and renovations
Prepare a list of major upgrades, repairs or renovations to be presented to the home appraisers, especially work that would be difficult to observe during an appraisal. Such work may include a new roof, drain tile, electrical, plumbing, insulation and mechanical systems.
Do you require the services of an appraiser in Vancouver?
For a homeowner, an appraisal can make or break a real estate transaction. For the mortgage lender, it can mean the difference between loss and profitability. Why leave it to chance? If you are in need of home appraisers in Vancouver, contact us at Adlaw Appraisals Ltd. We guarantee appraisals that are accurate, speedy and done with integrity. Our uniquely qualified appraisers are ready to discuss your needs and ensure a successful transaction.