What Appraisers Look For in Determining Home Values

Appraisers play an important role in the real estate industry. Once a contract is in place on a home, an appraiser — usually sent by the lender due to loan requirements — goes to the home, walks through and around it, and makes notes on the property to determine the home’s value. Appraisers also pull recent home sales (very recent, like from the past month) that are comparable in size, type, and location to the current property. So, what exactly are they looking for?

  • Condition and Curb Appeal. If the home is in poor condition, it is going to be a negative mark on the appraisal report. In addition, if the home is in good condition but is outdated in terms of design — think avocado colored appliances, metal cabinets, shag carpet, and the like — it is not good for the home’s value because it means the next owner will have to do a lot of work to get it up-to-date. Keep in mind that exterior factors are important too. Well-maintained landscaping, siding, roofing, sidewalks, and driveways will increase value. (Hint: Sellers, the more you do in advance, the better chances you’ll have of getting a higher bid!)
  • Foreclosures. Thankfully, Harrisonburg and Rockingham County don’t have many foreclosures occurring, but appraisers do take it into consideration if a lot of homes in one neighborhood have gone into foreclosure recently. If your home is being appraised and you live in such a neighborhood, beware of a lower value than it could have been if those other homes had sold in a regular transaction. It isn’t fair, but it is what it is.
  • Location. Location is a very important part of a home’s value. Ask any home buyer looking for a home right now. They almost always have a specific area of town they would like to live in, and have a good reason for it. If a home is located in a safe area that is undergoing a lot of updates, remodels, new businesses, etc., that is good for the value. On the flip side, if a home is located in an area that is run-down, and known for its crime or even gang activity, the value will decrease.
  • Supply and Demand. If your home is like a lot of others in your area for sale, appraisers will take that into consideration. Having a lot of homes on the market in similar size and condition means buyers aren’t really looking for that type of home, so values go down. It is important to price your home aggressively from the beginning in order to avoid this situation!

There you have it. A glimpse at what an appraiser looks for in each home.

Sellers: If you are thinking of selling your home, or already have your home on the market, just remember to highlight the great things about your home, update the outdated items (if you can afford to), and maintain your home well and take care of it.

Buyers: Keep in mind when searching for a home the location, condition, and size of the home. If you purchase a home that is move-in ready, make sure you keep it in great condition while you are living there, and if you purchase a home that needs some work, develop a plan and a budget so you can get more bang for your buck later on when you sell.

About Lisa Oates

Lisa is the creative mind behind The Harrisonburg Homes Team, providing streamlined content management, quality authorship, and graphic design for Harrisonblog. She's passionate about blogging, enjoying life, and a good cup of coffee.

Leave a Reply

Your email address will not be published. Required fields are marked *