What You Have To Know About Property Appraisals ?
One thing that home buyers and sellers tend to take time over is the price of the property. Each would look to sway things in their favor and get the best price possible. Therefore, once they agree on it, all things should be set and ready to go, right?
A home appraisal is not only necessary during a home purchase but also during the refinancing of an existing mortgage. If you are an interested party in the purchase or sell of a home, it is important for you know about the appraisal process.
The team from Sapphire Capital Investment offers their take on the matter.
What is a home/ property appraisal?
An appraisal is the analysis of the value of the property by a licensed appraisal. They are typically hired by the lender when a property is being purchased or during the refinancing of one.
The appraiser is important to the lender because they ensure that the mortgage loan is not more than the value of the property. The appraisal can also come in handy where the value is lower than the price agreed. It can allow for a reopening of negotiations.
The property appraisals processes
Once the seller and buyer have agreed on a price, the lender will choose an appraiser from their panel. They will get in touch with the current property owner and schedule a day for the date and time for the home visit.
The first stage of the appraisal process is the inspection of the property. Both the interior and exterior of the property will be inspected. The appraiser will seek to confirm the structural shape, presence of any safety or health hazards as well as major renovations or upgrades. Photos of the property will be taken for reference purposes.
If the purposes of the appraisal is a FHA-backed loan, the inspection might be a bit different. The appraiser might need to test all appliances and utilities as per prescribed government requirements.
After the inspection, the appraiser will perform individual and unbiased research to determine the value of the property. They seek for comparative sales in the neighborhood from reputable records and home sale information. An example of such a database is the Multiple Listing service, a database that contains home listing and sale information.
The method of valuation will also determine the value of the property. Depending on the nature of the property, the appraiser will choose the most appropriate approach to the valuation of the property.
Appraisal Tips for Property Owners
From our experience in the Tucson property market, there are a few tips that can help you improve the value of your property.
- Ensure that all mechanical devices, appliances and systems are in good condition and working properly.
- No obvious repairs should be needed. Hire a professional contractor to guarantee this
- The exterior of the property should not be neglected. Landscaping can go a great way to improving the value of your property.
The time between the sale agreement and home inspection might be too short to implement some of the above. Start on them early enough.
For more information and professional advice on Tucson property, rely on the investment experts at Sapphire Capital Investment. We specialize in the buying and selling of property. Our extensive knowledge and experience has been the difference for many investors and home owners in the past.
Get in touch with us today and get a quote of our services.