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Understanding the Appraisal Process: An Overview

Mar 03, 2021

Have you ever wondered what those mysterious appraisers do and how they determine a home's value? Our appraisal expert worked as a residential appraiser for over 15 years appraising over 1o,ooo homes. We will be doing a series of posts explaining the residential appraisal process. We hope that sharing this information will give you a better understanding of how the appraiser determines value which will help you better serve you clients.

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The appraiser receives an appraisal request. The first thing the appraiser must do is inspect the property. While on site the appraiser will measure the home for square footage, take a bedroom and bathroom count and take photos of each room of the home and the exterior to support the quality and condition level of the home.

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The fact that the appraiser will measure the home is significant to both the home owner and real estate agent. The square footage number the list price was based on must be very close to the square footage number the appraiser will be using when determining market value. If not, there is the possibility that the home will not appraise for the agreed upon sales price which might mean the purchase loan will not be approved. 

We suggest getting a pre-listing measurement of the home. Getting a pre-listing measurement will eliminate home size differences between the listing and the appraisal. In addition...did you know that listing a property with a wrong size can add additional liability for the real estate agent?

After the appraiser inspects the property the research begins. The appraiser will be looking at recent sales in the same neighborhood as the home. The appraiser compares the home size, age, room count, quality and condition to the size, age, room count, quality and condition of homes with recent sales. This is how the appraiser determines the market value of the home. If there are no comparable sales in the neighborhood the appraiser may have to research homes outside the neighborhood. A one mile radius is generally considered acceptable for comparable sales. School districts are also a consideration when leaving a neighborhood to find comparable sales.


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