Information about appraisals that will help prepare sellers.
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What should sellers know about appraisals? An appraisal is an expert opinion of the value of a property. An appraiser will come to your house and estimate how much the property is worth, usually on behalf of a bank, and it can significantly impact the buying or selling process.
During a residential property appraisal, the appraiser will find comparable sales of similar properties sold within the past three to six months as close to the subject property as possible. They will also consider other characteristics of the house, such as its size and type, to find the most comparable properties. The appraiser will then take note of any differences that could affect the home's value, such as an extra garage or a different condition.
The appraiser will use this analysis to determine the property's value, which can impact the purchase or sale of the home if it differs from the actual purchase price. This affects buyers and sellers differently, as a gap between the appraised value and purchase price means someone will have to make up the difference. An experienced agent can handle this situation, and sometimes a low appraisal can benefit a buyer if handled correctly.
As a seller, you can negotiate for buyers to have a contingency in place to protect you if the appraisal comes back low. As a buyer, this kind of clause can make your offer stronger to potential sellers. Ultimately, it comes down to your specific situation and property.
Appraisals can be a confusing part of the process for many people, so don’t hesitate to ask me any questions that you have. Call or email me anytime; I am here to be your real estate resource. I look forward to helping you through the selling process.