Thursday, December 27, 2012

Home Appraisals: What You Need to Know

How Real Estate Appraisals Are Really Done
How Real Estate Appraisals Are Really Done (Photo credit: Dave Dugdale)

A home appraisal is used to determine the value or worth of a property. It is mostly used to determine how much a lender can give the buyer for the purchase of the property in question. It is an expert opinion to protect the financier from getting stuck with a property worth less than the invested amount. Don't mistake the appraisal process with an inspection process. An inspection involves noting potential problems that can prove costly to remedy in the future, while an appraisal uses the general state of a property to determine its worth.

What to Expect During the Appraisal Process

Here is what you should expect during a home appraisal:

Full Access

Expect the appraisers to want full access to your home. The appraisers will want to look over all areas including the garage, attic or basement. This is done to determine how well the property was constructed and how well it has been maintained.


The appraisers will also take a lot of photographs of your home, both the interior and the exterior. The photos will be shown to the lender as proof of the condition of the house.

Overview of the Home

You should also expect the appraisers to be interested in the general overview of the house. This includes foundations, improvements, type of rooms, number of rooms and even its age. This overview, however, will not be as thorough as the inspection process.

Square Footage Approximation

The appraisers will also be interested in the total square footage of your home. In this estimation, the non-living areas are usually excluded, but just jotted down as side estimates. Examples of non-living areas include porches and garages.

How to Prepare Your Home for an Appraisal

To ensure that your home is properly appraised, and that the appraisers see its real value, you should prepare your home beforehand. Here is what you can do to help:

Improve Your Curb Appeal

Your front yard makes the initial first impression for those who come to your home, appraisers included. This means if you wish to make your house presentable and well maintained, you cannot ignore the curb appeal. Work on the yard area and the general appearance of the exterior. Ensure that you get rid of any mold and mildew that may be present, clean the gutters and remove overgrowth on the sidewalks. While curb appeal may not necessarily be used to appraise the property, it can be useful in affecting your appraisers' attitude even before they examine the house.

Note all the Updates

You should note all the updates and improvements you have made to the home and show them to the appraisers. This list should preferably cover all the updates done within the last 15 years. If you have their approximate dates and costs, it would be helpful too. Some appraisers also say that you should also include the noteworthy features of your home. Appraisers are professionals, but they are still human and it is easy for them to miss something.

Note Neighborhood Changes

Some people might say that this is an appraisers' job, but it still doesn't hurt to give them a hand in it. After all, they may not be aware of the next door property sold without the involvement of an agent? Data from such a sale may not be readily available.


You should have the necessary paperwork ready before the appraisers arrive. This includes things like certificates of occupancy, tax bills, financial statements and others that may be needed. If there are reports from recent appraisals, you should present them too.

Most appraisals are done when a property is to be sold, but that is not the only occasion that calls for an appraisal. Most insurance companies request a home appraisal before determining homeowners insurance rates. Irrespective of the reason for the appraisal, you should prepare for it using the above tips.

Adam Vaught has extensive experience in the insurance industry. He enjoys sharing his knowledge on appraisals to readers of various insurance and personal finance blogs.

1 comment:

  1. I learned all of this from my conveyancer. Everyone should always be careful in deciding for their home appraisals so better hire a conveyancer as soon as possible.


Join 1000's of People Following 50 Plus Finance
Real Time Web Analytics