What is an appraisal
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In order to protect all parties in a financial transaction involving Real Estate an independant and accurate evaluation of the property involved would require an Appraisal. This Appraisal should be accomplished by the most qualified and experienced Appraiser available with knowledge of your market.
Most of the people involved are very familiar.
- The Realtor is the most common face of a sales transaction.
- The mortgage company provides the financial capital necessary to fund the transaction.
- The title company ensures that all aspects of the transaction are completed and that a clear title passes from the seller to the buyer.
- This is where the Appraisal comes in. An appraisal is an unbiased estimate of what a buyer might expect to pay - or a seller receive - for a parcel of real estate, where both buyer and seller are informed parties. Because of the independent nature of the Appraiser i.e. his compensation is not tied to the value of the property, he can be expected to give the most accurate and unbiased opinion of the current value of the property. This will not always coincide with the value developed by the Realtor with a Competetive Market Analysis which is a less detailed and less in depth procedure
Prior to the inspection:
Research: Before we come to your home we conduct research to gather as much data about your house and neighborhood market as we can. We consider: Current condition of the house being appraised, resent “comparable” sales and current listing/pending sales.
Fannie Mae, USPAP, Lenders and Florida law all have a part of the appraisal process. All of these entities, have their own set of rules, ethics and regulations that we appraisers must follow. All of these rules ethics and regulations are in place to protect all of those involved in the real estate transaction.
An appraiser's duty is to inspect the property being appraised to ascertain the true status of that property. He or she must actually see features, such as the number of bedrooms, bathrooms, the location, and so on, to ensure that they really exist and are in the condition a reasonable buyer would expect them to be.
At the time of the inspection, your appraiser will take interior and exterior photos, measure your house, and ask you some questions about the house. Once the inspection is finished the appraiser must then use the data collected on site to conduct the appraisal report which can take anywhere to a few hours to a few days depending on difficulty.Most importantly, the appraiser looks for any obvious features - or defects - that would affect the value of the house.
Appraisers rely most heavily on the sales comparison approach. Appraisers are familiar with the neighborhoods in which they work. They understand the value of certain features to the residents of that area. They know the traffic patterns, busy throughways, quality of construction and amenities to certain neighborhoods; and they use this information to determine which attributes of a property will make a difference in the value. Then, the appraiser researches recent sales in the subdivision or immediate neighborhood and finds properties which are ''comparable'' to the subject being appraised. The sales prices of these properties are used as a basis to begin the sales comparison approach.
Using knowledge of the value of certain items such as square footage, number of bathrooms, updated kitchen, baths or floor coverings, paint or roof coverings or view lots such as water or golf front (just to name a few), the appraiser adjusts the comparable properties to more accurately portray the subject property.