What Sellers Need To Know About Appraisals
Answering three common questions about appraisals to prepare sellers.
Are you thinking about selling your home? If so, how exciting! This process means a fresh start and new beginnings. However, before you list your property, it is important that you completely understand appraisals. An appraisal is an opinion of value, where an expert appraiser will come to your house and estimate how much it is worth. They will provide a written report based on their inspection of pertinent information that determines your home’s value. This could greatly affect the success and price point of your sale, so it is crucial to be prepared. Here are three common appraisal questions and their answers:
1. What are appraisers looking for? They consider a wide variety of factors, like the floorplan, quality of construction, finishes, number of bedrooms, and square footage. They will compare your home to the listing to make sure the features are accurate. Also, they’ll take note of any upgrades that have been made to the house and if there were the proper permits for them, so make sure you have all of that in order beforehand. Last, they will be looking at comparable home sales in your area.
"Unless you get the appraisal done right when you sell your home, it may not be very accurate."
2. Why does an appraisal gap occur, and what should I do if it happens? Speaking with your agent about this issue is crucial because you can address it before accepting an offer. If an appraiser determines that your home is worth less than the price you were offering, the bank won't grant you a loan unless you negotiate a new price or cover the gap with cash. This means you'll have to come out of pocket with funds to bridge the difference.
3. Should I get a pre-appraisal done? The value of your home can change as soon as the appraiser leaves. This means that unless you get the appraisal done right when you sell your home, it may not be very accurate. This is particularly true in markets where homes have been appreciating rapidly, such as those we've seen over the past few years. In addition, an appraisal isn't useful to anyone other than you, but your agent can help you arrive at a price that's in line with what the appraiser would recommend without incurring additional costs.
Appraisals can be a confusing part of the process for many people, so don’t hesitate to ask us any questions that you have. Call or email us anytime; we are here to be your real estate resource. We look forward to helping you through the selling process!