Whether you’re buying or selling a home, getting an accurate appraisal is one of the most important steps you can take.
After all, buying a home is likely the largest investment most people make, and bidding on your dream home with starry eyes could cause you to go way over its market value. An appraisal helps buyers know the real value of the home they want to purchase, so they won’t overpay conceivably tens of thousands of dollars, according to RealEstateABC.com.
A real estate appraisal determines the estimated market value of a property. If you’re buying, you’ll need one to get an approval for your mortgage because it determines how much a bank will lend you. Your existing home becomes collateral so that if you default on your loan the bank can sell your property to recoup their money, says RealEstateABC.com.
A typical inspection includes checking the inside and outside of the home, and also checking asking prices for comparable homes in the area, says goodfinacialcents.com., which stresses that it’s important to note that an appraiser is not a home inspector and does not determine if a home is up to code. If you’re buying you definitely will want to hire a home inspector, however, to catch any needs for expensive repairs.
Appraisals average $300 to $400 and appraiser fees are usually included in closing costs if the house sells.
As the buyer, if the appraisal is low, it may be something that the owner can fix. It could also mean that the home was priced too high, says GFC. If so, the owner may come down in price.
If you’re selling and your appraisal is low due to needed repairs, get another one after the repairs are done. Another way to increase your appraisal price, especially if your home is older, is with new paint, appliances, carpeting and windows, adds GFC.
ReMax Real Estate Concepts
120 N 2nd Avenue West
Newton, IA 50208