A home appraisal is a vital step in the real estate process, but what exactly is it and when is it a good idea to get one?
A home appraisal is a commonly performed evaluation used to determine a home's reasonable and precise market value price. An appraisal is performed by a certified real estate appraiser who is unbiased and provides an honest and accurate value of the home. Therefore, an appraiser works as a neutral party to ensure that the buyer, seller, and seller’s lender know what the home is worth.
Furthermore, the appraiser will compare many factors of the home and surrounding area to other nearby homes that have recently been sold to determine the value. Some factors that the appraiser takes into consideration include the overall condition and quality of the home, how old the home is, what the neighborhood and surrounding area are like and how fast it is growing, any renovations or upgrades that have improved the quality of the home, and the average worth of similar nearby homes. All these factors combined total the value of the home.
Of course, when buying or selling a home, you will get an appraiser, but there are other reasons to appraise your home, such as deciding to refinance your home, securing a home equity loan, and inquiring about other types of loans, and appealing contradicting tax estimates.
Additionally, it’s important to keep in mind that an appraisal will remain completely accurate for only around four months. Therefore, when any of the above scenarios occur, you will likely have to undergo a current appraisal.
In conclusion, home appraisals are a vital step in any real estate transaction for buyers, sellers, and lenders to know the accurate value of a home before taking any more steps forward.