What Do Appraisers Look For In A Property?

When appraising a home, what do appraisers look for? A house appraisal is an important part of the home-buying process since it determines the property's worth. Realtors utilize appraisal addendums to win multiple offer situations when making an offer on a home, demonstrating how crucial an appraisal is to both buyers and sellers. Understanding how the appraisal process works may help both buyers and sellers prepare correctly, since an appraiser will check for many essential aspects while performing a house evaluation.

We'll go over how the house appraisal process works, what to anticipate before, during, and after a home appraisal, and how to properly prepare for the day of the assessment in this post. While the appraisal process may appear intimidating to both buyers and sellers, there are numerous steps you can take to ensure your house appraises properly.

 

What Is A Home Appraisal & Why Do You Need One?

A house appraisal is a calculation of the property's worth. It's usually calculated by having a qualified appraiser view the property and examining the prices of nearby properties that have previously sold. A mortgage lender will demand a house assessment before approving a loan to guarantee that the home is worth the amount the seller is asking. If a seller markets their property for $450,000 and you offer $435,000, the mortgage lender will want to make sure the home is genuinely worth $435,000 before approving your loan. If they discover the house is only worth $415,000 after doing a home evaluation, they may only be ready to lend $415,000. This means that either your real estate agent will assist you in renegotiating the purchase price with the seller to bring it down to $415,000, or you, the buyer, will have to come up with the funds to cover the difference between what your mortgage lender is offering and what the seller is asking for the house.

When refinancing a mortgage, homeowners can also obtain an appraisal. An assessment is usually requested by a lender to verify that they are not lending more money than the residence is worth. The mortgage lender will assess how much they will lend for the property when the appraisal is completed. So, during a house evaluation, what do appraisers check for?

 

During A Home Appraisal, What Do Appraisers Look For?

While comparing your house to other properties in the region, they will largely examine the size and overall condition of your home when performing their study. When establishing the value of your 3-bedroom house in Raleigh, North Carolina, they will analyze the number of similar 3-bedroom homes that have sold in the Raleigh region. They will examine your home's physical condition as well as non-negotiable features like as square footage, zoning, and other considerations, in addition to doing a comparative analysis of comparable properties in the neighborhood.

 

The Residence's Overall Condition

Before going too specific, the appraiser will take note of the home's basic features, such as the materials utilized throughout, the property's condition, and any worrying physical features that might affect its habitability. One of the first things appraisers check for is this! They will take note of anything that appears to be structurally unstable or hazardous to live in. They'll also look for things like missing door knobs, leaking faucets, and other maintenance-related problems. They will search for indicators of neglect, such as broken windows, damaged flooring, broken appliances, cracked walls, broken doors, shredded carpets, and so on, rather than whether or not the house is tidy.

 

The Location Of The House

The location of the home will be considered by appraisers. When completing exterior field appraisals, the appraiser will take into account the location of the home. The value of a house is heavily influenced by its location. They'll look for a home that's close to good schools, has a low crime rate, and is close to a hospital, fire station, and police station. They'll look to see if the house is close to any owner-occupied, renter-occupied, or repossessed houses, as well as whether it's on a busy road. They'll also take note of whether it's in a suburban neighborhood or a rural/urban setting. Those in extremely desired regions, such as Plaza-Midwood or Myers Park, two of Charlotte's nicest neighborhoods, will be worth significantly more than homes in less desirable places. The adjacent homes in the community will also be taken into account by appraisers. Do they mostly consist of single-family houses, apartment complexes, or commercial properties?

 

The Home's Golden Age

The age of the home is something that many people overlook and that appraisers check for. Both new and old houses have benefits and disadvantages, so a new home isn't certain to appraise just because it's new. Older homes are frequently well kept and are often found in historic districts, whereas modern homes may have issues. Nonetheless, the home's age will be considered throughout the assessment process. New construction is always more valuable than residences erected more than a century ago.

 

The Outside Of The House

A house appraiser will examine the home's exterior to confirm that it is structurally sound. They'll search for evidence of water damage or other issues, such as a cracked or leaning chimney (which might suggest structural damage), as well as a crooked porch or stairwell leading up to the house.

The condition of your roof will also influence the sale price of your property. Infestation, leakage, and other issues are caused by damaged roofs, thus the appraiser will evaluate the home's roofing quality. If you're aware of a problem with your roof, talk to your real estate agent before shelling out tens of thousands of dollars to fix it. It can be more cost-effective to cut your home's asking price rather than spend a lot of money on a brand-new roof. In addition to the roof, the appraiser will go over the siding, garage, porch, deck, and any other external features.

The Home's Design

The appraiser will take into consideration whether your house is really outdated and hasn't been upgraded in several years – or decades. If the house is old, it will only appeal to a small number of purchasers and will be more difficult to sell.

 

Water Damage Signs

Mold, mildew, rotting, and other concerns can arise as a result of water damage in a property. Water in the basement, plumbing issues, roof leaks, and stains on the ceilings, floors, or walls will all be investigated by the appraiser. If your house has minimal water damage, you may be able to fix the situation yourself to prevent your buyer from walking away from the transaction.

Mold removal may cost thousands of dollars, therefore water damage is an important part of the appraisal process. Not only that, but mold is incredibly poisonous and harmful to people who come into contact with it. Mold poisoning may cause serious respiratory problems as well as a slew of other health difficulties.

 

House Dimensions

Appraisers analyze comparable properties in your neighborhood that are similar in size when valuing your property. When calculating the worth of your property, they will pay close attention to the square footage and number of bedrooms. The size of the property on which the house is built will also be assessed by the appraiser. A home with a three- or four-car garage will value more than a home with a one-car garage or no garage at all.

 

Interior Design Of A House

The appraiser is usually the one who spends the most time looking at the inside of the house. A home's structure and general condition will be evaluated by an appraiser. The amount of bedrooms and bathrooms, as well as whether or not there is a basement, attic, or crawl space, are usually the first things that buyers look for when evaluating a home's interior. They will examine the foundation type and the materials utilized on the flooring, windows, and walls of the house.

While they are not usually concerned with cosmetic aspects, they will notice if the house is in poor condition. They'll examine the doors, windows, ceilings, and walls, as well as any leaking faucets or evident electrical problems.

 

Improvements To The house

The appraiser will notice whether any rooms in the house have been updated, particularly the kitchen and bathrooms. Energy-saving appliances and other environmentally friendly features in the home are also a benefit. They'll also notice if the house has a fireplace, a porch, a patio, or a fence surrounding it.

Some house upgrades increase the value of a property, while others do not.

It is possible that your property may appraise higher if it has central air conditioning rather than individual air conditioners in each room. The appraiser will also determine if your heating and cooling systems are oil, gas, or electricity-powered, as well as any obsolete heating and cooling systems.

Any further improvements to the home, such as new hardwood flooring, a new garage or front door, a new roof, new siding, and so on, will affect the appraised value.

 

Infestation Symptoms

The appraiser will search for symptoms of termites or other pests on the flooring and windowsills, but not a comprehensive pest examination. Termites, rodents, and other pests can cause irreversible structural damage to a property, thus this will be considered throughout the appraisal process.

 

Added Security Features

Certain safety measures will be required if you are applying for a government-backed loan, such as a VA or FHA loan. The appraiser will search for smoke detectors on each level of the house, as well as railings on all stairwells and other safety features.