What is the true value of your home? There are a few ways to determine what your home is worth. You can look at real estate sites like Zillow to see an estimate of your home’s value, or rely on your realtor to assess its worth. But these types of estimates may be biased and can leave room for over or underpredicting, which can be frustrating to the owner if the estimate falls short of their expectations. A Zestimate on Zillow for an off-the-market home, for example, can be off by 7.5% on average.
The best way to determine the true value of your home is with a professional, residential real estate appraisal which is a neutral evaluation and opinion of the value of your home. While a real estate agent may be motivated by procuring your listing or offer and earning a commission, a professional real estate appraiser will be impartial and will value your home with accuracy and fairness.
So, when do you need to have your home appraised? It’s common to have a valuation when you are planning to put your property on the market so that you know it’s fair market value. But there are many reasons to get your home appraised.
- Selling Your Home. A seller may want a pre-listing appraisal to know the true value of the home before putting it on the market so that they can list it at an accurate price.
- Purchasing a New Home. After you’ve purchased a new home, your bank or lender may order an appraisal to ensure the price of the home is accurate and that the property is worth the amount of the loan.
- Refinancing Your Mortgage. Your bank or lender will order an appraisal to know whether the home’s value justifies the new loan amount when refinancing.
- Collateral. If you seek a loan for renovations or businesses where you must put your home up as collateral, your lender may request a current home appraisal.
- Tax Assesment. If you believe your home has decreased in value, you may want to have your home appraised if your property taxes are based on the value of your home.
- Discontinuing Mortgage Insurance. An appraisal will be needed to show that you have enough equity in your home in order to remove PMI from your loan payment.
- Divorce. In the unfortunate event of a divorce or separation, a home appraisal is common so that assets can be divided between the parties fairly.
- Bankruptcy. When filing for bankruptcy, a bank may require an appraisal to determine the value of your assets.
- Estate Probate. In the unfortunate event of a property owner’s death, a certified appraisal will be needed for tax purposes, and any division of the estate to its beneficiaries.
Now that you know if you need a home appraisal, you may also want to know what to expect and how to increase your home’s worth before it is appraised. It will be helpful to know what an appraiser will be looking for. They will consider many factors, including current housing rates, the value of comparable homes in your area, and details of your home, such as square footage, amenities, and overall property condition.
Some of these factors may be out of your control, but there are some steps you can take to get your home ready for an appraisal that won’t take a ton of time or cost you a ton of money.
Curb Appeal. First impressions matter, and the exterior of your home will be the first thing an appraiser will see. Cleaning up your yard can go a long way. Trim landscaping and grass, clean up driveways, garages, and porches. Even simply adding numbers to your home or mailbox to can help improve your curb appeal.
Declutter Your Space. An appraiser will look at your home, not your personal items, but a clean and tidy home will give the impression that the house has been well-maintained. While you don’t need to redecorate your entire home, a deep clean and “staging” your home will help create a desirable tone. You may even want to put away some furniture to declutter and update lighting or window treatments.
Minor Repairs. Make any minor repairs that you’ve been neglecting to the exterior and interior, like patching walls, touching up paint, or repairing damage to siding or roofs. You may want to consider power-washing the exterior as well. In some instances, a fresh coat of paint may be necessary (neutral colors are always a great option).
When getting ready to sell your home, it’s not the best time to make significant renovations because you won’t likely get a hundred percent return on your investment. But be sure to let the appraiser know of any recent updates that you have made to your home, such as a new furnace or roof. It also doesn’t hurt to point out recent sales in the neighborhood or local amenities such as a desirable school system.
A professional and certified appraiser can help you determine the true value of your home. At RMS Title & Appraisal, our standards go above and beyond the Uniform Standards of Professional Appraisal Practice. Communication and transparency are of utmost importance to us and we pride ourselves on being responsive, reliable and trustworth so we meet your expectations.
Do you need valuation help? Our professionals at RMS Title & Appraisal can help you get an accurate appraisal and answer any questions you may have. Contact us to speak directly with one of our dedicated agents!