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As a homeowner, you may have thought about a home appraisal, but have no clue what it can actually do for you. Often, they are associated and thought of when going through a sale, but they can do plenty more!
A property or home appraisal can be extremely beneficial in understanding more about your home’s value and areas where you might be able to improve it. And as you may already know, home appraisals are needed when buying or selling a home. To help, here’s what you need to know about home appraisals.
Once you’ve had your home appraised, you might need some touch ups to add value. Contact a contractor today to receive up to four quotes from contractors in your area, for free!
What Is A Home Appraisal?
A home appraisal is a must if you are buying a home or taking out a mortgage, but what does it really do? A home appraisal is done by a third party, outside of you and your insurance company, who will assess the value of your home based on various criteria. Here are a few factors that come into play here:
- Home exterior, roof & foundation condition
- Size of home & size of property
- Home interior condition
- Upgrades & renovations
- Unique features, such as a pool or radiant floor heating
These are all areas your home appraiser will examine carefully to assess the market value of your home. They might also ask you direct questions about your property to help them learn more. Try to give them as much information as possible to determine the most accurate value of your home.
When Do You Need A Home Appraisal?
A home appraisal is necessary if you are buying property and taking out a mortgage. This is done after negotiations and the home inspection, but before papers are signed. This is so the lender knows the true value of the home and is confident the buyer is receiving the appropriate amount of money. You’ll also need a home appraisal if you’re taking out another mortgage on your home.
While it sounds simple, many in the buying and selling process fear a low appraisal, where the deal can fall through. That’s why it’s a good idea for anyone looking to sell their home in the future to have an appraisal before the home is listed.
Not quite as common, some homeowners choose to get a home appraisal after a major addition or remodeling project, so they can better understand the ROI.
Home Appraisal Cost
If you’re buying or selling a home, home appraisal costs may be tied into your closing amount. However, it’s more than likely that you’ll need to pay out of pocket for these expenses. It’s certainly something to budget for during the home buying process. The average cost to hire a property appraiser is $311, with most homeowners spending between $299 and $333.
How To Appraise Your Home
A home appraisal is not something you can do yourself. You must hire a professional who can give you an unbiased value of your home. You’ll need to find a home appraiser you can trust. Research local home appraisers and read reviews of that pro. A great place to start is the Appraisal Institute, which is the professional association of real estate appraisers. Be sure to get more than one quote so you can compare and hire the best person for the job.
Prepare For An Appraisal
If you’ve scheduled your home appraisal already, you might be wondering what to do now. Start with a self-evaluation of your home. Notice anything that is broken or could use a touch-up and contact a handyman who can help. It’s also a good idea to tidy up, to make it easier for the home appraiser to move around your home and observe its true quality.
This goes for your landscaping as well, which can help improve the final assessment. You might also want to make a list of home improvements of home remodels or upgrades you have done to have it handy for when you speak with your appraiser.
How To Increase Home Value
Once you receive your home appraisal back, look through the report thoroughly. If it was less than you thought, you might want to consider making a few home upgrades. Here are a few common projects homeowners can do to increase the value of their home:
- Update paint
- Roofing repair
- Kitchen remodel
- Bathroom remodel
- Foundation & masonry repair
- Improve landscaping
These updates are especially important if you intend on putting your home on the market soon. For some, the improvements are DIY. However, if your roof or foundation needs repair, it’s best to leave that to a pro.
When you’ve made the improvements, consider getting another appraisal. Your mortgage company may help cover costs of a second opinion if you have sufficient evidence that your first appraisal might not be sufficient. Contact your lender to find out about what they offer.
Home appraisals are an important part of the buying and selling process, but they can also help you determine the accurate value of your home so you can make the right home improvements. Review the findings from your home appraiser and make the adjustments needed to improve your home’s value.
Are you thinking about listing your home soon? Read 5 Ways To Prepare Your Home For A Sale.