How Home Appraisals Are Completed
Thursday, February 16th, 2012Getting ready to buy a new home and need to put your present home up for sale on the real estate market? If yes, we are here to help you successfully sell your home for its value by providing information on how home appraisals work. Read to become informed before putting your home up for sale.
The value of your property is what determines how much a lender is willing to give you to buy real estate property. It is important to know whether a home is overpriced or under-priced in the real estate market.
A home appraisal protects the bank and you from buying property that is worth less than what was invested. You never want to pay too much for a house.
The following are factors included in a home appraisal:
The Home Appraisal Methods
A home appraisal is usually done at the time of closing. It cost on average $300 or more depending on the price of property.
There are two main appraisal methods – sales comparison approach and cost approach. Sales comparison approach compares property of three or four similar homes sold in the area. Cost approach is only used for new property and based on reproduction costs. Basically the question the appraiser wants to answer is how much would it cost to replace the structure of a home on property, if it were destroyed. Land value and depreciation are used to determine worth.
What The Appraisal Report Includes
The following are included on the Appraisal Report:
Ø The size and condition of the house and its permanent fixtures.
Ø Improvements to the home and the materials used in the improvements.
Ø Structural Problems in the foundations such as cracks and wet basements.
Ø An evaluation of recent market trends and how it can affect property value.
Ø A Comparative market analysis.
Ø Maps, Photographs and Sketches.
It is important to have the home appraisal completed to obtain a loan amount that will give you the ability to buy your dream home.
If you have any questions, please contact Jeremy Walsh Real Estate by calling 443-610-5722 or click here today!
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Source: How Home Appraisals Work
