Residential Appraisals 101: Understanding the Basics of a Home Appraisal
Regardless of why you need a home appraisal, understanding what residential appraisals are and how the process works is important. After all, knowledge is power, and the more power you have throughout the process of buying or selling your home, the better!
Below is the key information you should be equipped with prior to having your home appraised:
What exactly is a home appraisal?
Simply stated, a home appraisal is a professional’s opinion about how much your home is worth. An appraiser will examine the overall condition of your home—including the foundation and roof, plumbing, heating, and any other essential systems—and provide a detailed report outlining your home’s valuation.
Why might you need residential appraisals?
The most common reason for needing a home appraisal is during the process of buying or selling your home, or refinancing your mortgage. Your bank or mortgage lender will require an appraisal to ensure that the market value of the home matches the loan amount.
How does the appraisal process work?
The appraisal process is regulated at the state level. A certified appraiser will visit and examine your property—this can take as little as 15-30 minutes or as long as several hours depending on the size of your home. The appraiser will look at the value of comparable properties in the area based on recent home sales, as well as data from multiple listing service (MLS), local real estate agents, and county & tax records. When the appraisal is complete, the appraiser will put together a report outlining his or her findings and estimation.
What factors will the appraiser consider?
When appraising a home, many factors play into the final valuation, such as:
Price ranges of other homes in the neighborhood
The size of the property, zoning, and access to utilities
The potential for flooding or other equally adverse conditions
The age and condition of your home’s foundation, roof, and general structure
Whether you’ve improved your home via the addition of a fireplace, swimming pool or other valuable add-on
The value of comparable homes based on recent sales
How long will it take to get my report?
Timeliness is everything when it comes to residential appraisals, as mortgage rates can only be locked in for a certain amount of time. Some appraisers can take weeks to deliver a final report. At Appraisals Unlimited, we pride ourselves on a fast turnaround, oftentimes delivering the final report within 48-hours of the inspection.
What happens if the appraisal doesn't match up with our expectation?
Sometimes, an appraisal comes in higher or lower than expected—and, in both situations, you’ll have some decisions to make.
