So, What Adds Value To Home Appraisal to make this tricky determination?
To help you get a glimpse of your home from an appraiser’s eyes, we spoke with John Huston, a professional appraiser from St. Petersburg, Fla., Who serves three counties and has appraised over 3,800 properties since 1999.
Let’s break down the dozens of internal and external factors that are in the Uniform Home Appraisal Report and take a look at the difference between the features of the home that add value and those that add market value.
What Home Appraisers Look For ? External Factors In The Home
Appraisers must be qualified and certified in your state and, in most states, adhere to the Appraisal Foundation’s Uniform Standards of Professional Appraisal Practice. Depending on the condition and size of your property, the appraisal process may consist of a quick 15-minute visit or a two to three hour review.
To begin with, the standard appraisal report includes external facts about the property: its enumeration area, neighborhood boundaries, and other legal definitions.
Other external factors include:
- neighborhood characteristics (i.e. urban, suburban, rural)
- Percentage of current land use in the neighborhood (one-person housing, two to four-person housing, multi-family, commercial)
- Classification by zones
- Lot size
- If the property is of public utility
- The type of driveway surface and any car storage. “Is there a one-car garage versus a two-car garage? The latter have value, especially in the scorching sun,” Huston said.
“A lot of the information is going to be based on numbers: measurements, part sizes… A lot of these things can't really be changed,” says Santiago Valdez, an agent in Chicago, Illinois, at Compass. for 15 years specializing in properties priced on average $ 258,000. With other agents, he likes to be present during the appraisal to point out any quirks or peculiarities of the property. “In Chicago, for example, a single family home is 19 feet wide. If you have a house that is 28 feet wide or 20 feet wide, you want to be sure to talk to the expert about it. It will be very different. , especially in a place like Chicago that has 25-foot-wide pitches, ”Mr. Valdez said.
What Home Appraisers Look For ? Internal Home Factors
Here the assessor takes a close look at the structure, condition and size, including:
- The area of the house
- Number of bathrooms and bedrooms
- Renovated or modernized kitchen and bathrooms
- Type of foundation
- Whether there is a full or partial basement, a crawl space or an attic
- Materials used for walls, floors and windows
- Although not a pest control inspector, Mr Huston said he would note if he saw any traces of termites, such as “termite soil” on window sills.
An FHA or VA loan will also require an assessor to note certain safety details, such as the presence of handrails on all stairs and smoke detectors on all levels, Huston said.
Mr Valdez said he liked to draw attention to features or drawbacks that might not be evident upon inspection of the assessor. For example, it will note whether a property has good natural light due to the number of windows or a higher ceiling. “The light in Chicago is incredibly important,” he says.
it’s close to a noisy air conditioning unit – something an appraiser wouldn’t notice in the winter.
What Home Appraisers Look For ? What is the general condition of the house?
An assessor will assess and comment on:
- materials and condition of foundations and exterior walls, roof surface, screens, gutters and downspouts
- The materials and condition of the floors, walls and trim
- Any physical impairment or adverse condition that affects the structural integrity or livability of the property
- Care and general maintenance, for example if the paint is peeling or if the faucets are leaking, if the door handles are missing etc.
What Home Appraisers Look For ? Home Renovations, Upgrades & Additions
An assessor assesses needs such as the type of heating and cooling systems a home has. He or she also considers upgrades and amenities such as:
- items with low energy consumption
- Fireplaces or wood stoves
- A patio or terrace
- A porch
An inground pool adds some value, but it’s depreciated value because of the maintenance it requires, Huston said.
In other words, spending $ 120,000 on an inground pool does not guarantee a higher appraisal value than your neighbor’s pool, which is $ 35,000. “If you’re going to resell, you won’t get $ 120,000 for your pool,” Fonseca said. “Each of you has a working pool. It doesn’t matter who spent the most money.”
What carries more weight are the upgrades, especially on older homes, like a new roof or an air conditioning system.
“A lot of times an expert will come to an air conditioner and he’ll see how old he is, or he’ll check the permits when he pulls one out,” Fonesca says. “But it’s different when you tell them it’s a Trane air conditioner that was just installed and it cost $ 7,000. And we just installed a new roof last year, and that was so much money “.
Having receipts and documents on hand for further renovations can also help the expert adjust accordingly, added Valdez. “It’s very hard to notice the difference between $ 15,000 cabinets and $ 60,000 cabinets if you don’t know what you are looking for.”
What reviewers aren’t looking for ? Movable Elements and Decor
While real estate agents appreciate neutral decor to help buyers imagine their possessions in a home, the overall aesthetic of a home is not at the top of an appraiser’s assessment criteria.
“The new ceiling fans, the Bahamian shutters… none of it adds value. It’s all considered a personal good,” Mr. Huston said. Typically, if the building is nailed down and you cannot remove it, it is considered part of the house.
An improved microwave has no added value, for example, because it is mobile. The same goes for a shed or a jacuzzi.
That said, “people don’t move hot tubs,” Mr. Huston said. While such an item does not add market value on an appraisal report, a real estate agent would say it does add market value.
If you have any personal property that you are selling with the house, such as a boat for use with a dock attached, this is something the appraiser should know.
How to prepare for your home appraisal
To help an expert see your home in its best light, experts recommend the following:
Gather relevant documents, such as the latest property tax bill and homeowner’s association or condominium agreements and fees
Compile a “boast sheet” of the main improvements and renovations made to the house, including the date of their installation, their cost and confirmation of permit (if available)
Make sure all parts of the house are accessible, including crawl spaces
Fix small blunders, like peeling paint on baseboards and squeaky hinges
The most important thing is to clean your home before the appraiser’s visit (use our comprehensive checklist for deep cleaning so you don’t miss a stain). Reviewers are trained to move beyond clutter and mess, but let’s be honest: a clean home leaves everyone with positive feelings.
If the valuation is low, you will need to negotiate with the buyer to get more money, lower the asking price, or request a second valuation.
“If you sell a car, you’re going to wash it, vacuum it, probably (put on) armored tires, because you only get one chance to make a first impression,” Huston said. “A lot of times people don’t do that.”