A real estate appraisal is an opinion of value, supported by facts and analysis, that is used for various mortgage and non-mortgage uses such as estate or divorce settlement, relocation, or property tax challenge, to name a few.
The appraisal itself consists of two basic parts: verification of the subject property attributes, and calculation of the value opinion. In this post, I will talk about the property verification. In subsequent posts, I will talk about the value analysis and the three approaches to value.
When an appraiser inspects a property, they try to confirm the information in public records, and determine the condition of the property, noting any needed repairs or adverse conditions. The first step in most appraisal inspections is to inspect and measure the exterior. The measurement of the exterior is how the Gross Living Area, (GLA) is determined. As stated in another post, the GLA listed in many public records is often incorrect.
After the exterior inspection and photos, the appraiser moves to the inside to ascertain the condition of the subject. One of the key items looked for are anything that creates issues with safety, structural soundness, and livability. Such things might include infestation, evidence of water damage from pipes or roof, security bars with no interior release, doors that open to the outside on the second story with no stairs (I've seen it!!), and other items.
Once the inspection is done, the appraiser normally takes pictures of every room. Many homeowners are concerned that every picture of their son's dirty room and filthy garage is going into the report. This generally is not the case. Most of the time the report will contain a sample of interior photos to show the interior, or items of concern. The majority of the photos are for future reference, in case the home is foreclosed on and the owners have done something to it since the inspection. They are proof of the condition on the day of inspection. It's a liability thing.
If you get an appraisal, your appraiser should take the time to thoroughly inspect and measure your home, as well as answer any questions. I personally take the time to properly inspect the property. If you want to make sure that you are getting a thorough inspection and an accurate value, give me a call or send an email. I'd be happy to talk with you about the entire appraisal process.