"Who Determines the Value of My Home?" - The Benefits of Hiring a Real Estate Appraiser

It's the job of the real estate appraiser. At heart, his or her job is to evaluate a property and tell you (the buyer) what condition it's in. Of course, as a seller, you can also have your home appraised so you get an objective "third party" view of your property.

Real estate appraisers are licensed (or should be!) by the state. Regulations vary, however, so I recommend you contact either me or a bank for information on qualified and ethical appraisers (more on this later). Often, they're independent contractors associated with appraisal firms headed by a Certified Appraiser or the equivalent.

What are the Benefits of Using an Appraiser's Services?

When you're a buyer, appraisers provide you two great benefits:

First of all, they can uncover hidden problems that could end up costing you a lot of money down the line. Their appraisal help you avoid the property or negotiate a lower price to compensate for future costs.

Second, appraisers can do the opposite -- uncover hidden opportunities for you! For example, you might be considering a home that that doesn't look all that wonderful on the outside, but is actually in solid shape as far as its structure is concerned. So, through an appraiser's efforts, you may end up with an outstanding bargain.

From the seller's viewpoint, an appraisal can uncover items that need fixing before you put your home on the market. This ensures that your property is in the best shape possible before buyers ever look at it.

What Kind of Report Will I Receive from an Appraiser?

A certified appraiser should provide you with a written report. These reports generally consist of the following nine items:

1. A description of the property and its location based on a visit to the property by the appraiser. The appraiser evaluates the condition, overall livability based on design, layout, and appeal to the market, and other external factors).

2. An evaluation of the “highest and best use” of the land; that is, the use for a piece of land, or property in general, that maximizes its net present value.

3. An evaluation of sales of comparable properties (usually three) as similar to the appraised property as possible.

4. Information regarding current real estate activity and/or market area trends.

5. An evaluation of the overall real estate market in the area.

6. Statements about items the appraiser feels are detrimental to the property's value, such as poor access to the property.

7. Notations about seriously flawed items, such as a crumbling foundation, leaking roof, etc.

8. An estimate of the average sales time for the property.

9. What type of area the home is in (a development, stand alone acreage, etc.).

How Do I Find a Certified Real Estate Appraiser?

I can direct you to very qualified appraisers. Or, you can find them through your bank. It should have a list of approved appraisers. If you decide to find an appraiser on your own, check his or her background carefully. As with any profession, there are always a few scam artists who inflate appraisal amounts in order to make money off you.

Check with the Better Business Bureau and your state certification office (if there is one). You can also check with your bank to make sure an appraiser is not blacklisted.

How Much Does An Appraisal Cost?

Generally speaking, an appraisal runs from $300 to $500. However, fees do vary with location.

If you need more information on real estate appraisers or any other real estate topic, be sure to call me at 215.504.7573 or email me at DSpaulder@PaDreamHomes.com. I'd love to discuss these matters with you!