Real Property Appraisal: A primer

Whether you are trying to correct an issue with your tax assessment or you are in the process of making a formal appeal, an appraisal is key to accomplishing your goal. In order to make your most solid case it is important to find the right panel of professionals to stand beside you throughout the process.

Most of the people involved in this process are well acquainted. The most well-known person in the process is a real estate broker. The bank handles all of the financial aspects of funding the transaction. Finally, the title company will make sure that all of the correct measures have been taken and that the title is handled properly.

Who is responsible for making sure the selling price matches the appraised value? This is when the appraiser becomes so important. We will give you a fair estimation of what the value of the property is. We will keep you informed as we move through each step of the process. An expert appraiser from the Home Appraising Group will work with you and keep you informed each step of the way.

INSPECTING THE SUBJECT PROPERTY

We at the Home Appraising Group will first assess your property to gain information on the true status of the home. A certified professional will visit your home and make notes on a number of things, including the number of beds and baths, any notable amenities and the condition of many aspects of your home. A sketch of the properties floor plan may be includes to accurately show the homes size, layout and other details. We make it a high priority to note any defects or issues that we find that could influence the valuation of the property.

After the site has been fully inspected by one of our experts we will apply two or more approaches to find the value of the property. This may include all or some of a paired sales evaluation, a replacement cost calculation, or an income approach (assuming there is a rental presence).

ANALYZING COMPARABLE SALES

With a strong understand of the specifics of your community, your appraiser know what buyers are looking for. They can go through a list of recent property transactions and create a list of home sales that are comparable to your homes size and general characteristics. They then take into consideration amenities and features of your home specifically. If your home has plenty of square footage, an extra bathroom and hardwood floors throughout, these are all value adds. These two elements are combined to find a number that meets the market.

  • Using the case of a comparable that recently sold and before listing the home got all new dry wall and paint in every room. We can compare that with a home being appraised that could use these same updates. When appraising the second house the evaluator would likely deduct the value of the dry wall and paint from the selling price of the first.
  • In the case that the home being appraised was the one with the updates, this value would then be added to the selling price of the first home to evaluate the true home value.

We at the Home Appraising Group are well versed in the value of many different aspects of real estate in Pennsylvania. We use this valuation approach very often when the appraisal is being done for the purchase of a home.

COST
APPROACH

When using the cost method the professional appraiser works to find the maximum selling price on the property in question. They do this by adding predicted costs of materials, labor and fees to build the same property in the current market. Although it is a useful approach in certain circumstances, it does not apply to all.

VALUATION USING THE INCOME APPROACH

If your property is in a community with a number of rental properties, this yields helpful information in finding the value of your home. In this case, the amount of income earned by the property can be factored in with the rental income of other properties nearby to arrive at the value.

ARRIVING AT VALUE CONCLUSION

By combining information from each of the chosen approaches, your appraiser can finalize the appraisal report and give you the estimated market value of your home. The report is then sent to all of the parties involved in making decisions about your property. This information is used by the officials overseeing your situation in order to make a final decision. Your appraiser at the Home Appraising Group will stand by you and their report to make sure you have the fairest valuation of your home.