Congratulations! You are through the grueling inspection process. So…what’s up next? The BIG hurdle in the home selling process…the APPRAISAL…
Why is it Needed?
An appraisal determines the value of your home AND more importantly determines how much the Buyer’s mortgage lender will lend you for your home. The value is established by a licensed Real Estate Appraiser, they are third-party contractors that are generally hired by the Buyer’s Lender. Appraisers establish the price the property on factors relating to neighborhood growth, housing trends and market conditions.
Appraisals typically cost a bit over $500 in our market, and typically the Buyer pays the fee at closing as part of their closing costs. There are exceptions so please discuss with your Realtor.
How Do I Prepare?
The Appraiser will call your agent to schedule a time to view your home. In our market we like our Sellers to actually let the Appraiser in their home and suggest they have a list handy of any upgrades they have made to the home that they feel could add value to it. While preparing, think about showing your home to a prospective Buyer….SHOW READY with lights on, great smells, blinds are open! The Appraiser is setting the value on your home, make it SHINE!
The appraiser will sketch your home to determine accurate square footage and take photos of your house while searching for any code violations that you will have to repair or fix prior to the lender approving you loan. IMPORTANT in Washington State carbon monoxides detectors are REQUIRED if they are not installed at the time of the Appraisal site visit, the Appraiser will have to return to your property…THIS may delay closing and there WILL be an additional fee. Ask your Realtor how many C02 detectors you may need and where they should be located.
How Does the Appraiser Formulate Value?
Besides neighborhood growth, housing trends and market conditions mentioned above, the Appraiser will review all recent comparable sales in your neighborhood to determine value, these are the same “comps” your agent hopefully used to establish the value of your home. The Appraiser will also adjust the the price of property up or down when comparing to the other homes based on such items as:
- Garage Bays
- Lot Size
- Curb Appeal
- Swimming Pools
- Construction Quality
- Square Footage
- Swimming Pools
- Updates within the Last 15 Years
- Number of Rooms including Bathrooms
The Appraiser typically delivers their report back to the Lender within 7-10 business days of conducting the appraisal. In our market the Buyer is allowed to see the report. They Seller will hopefully hear the magic words….”the appraisal is in at value with no work orders” which means the Appraisal is complete and Buyer and Seller can move to the next stage of the process.
April Connors is a licensed Real Estate Broker with The Connors Group at Windermere Real Estate located in Southeast Washington State.