Getting Inside The Head of a Real Estate Appraiser: Tips To Make Your Appraisal Inspection Go Smoother

Have you ever needed to get an appraisal on your home and worried about what the appraiser looks at and considers important and what he doesn’t care about?  It’s o.k. if you have felt this way, it’s a valid concern.  Sometimes I feel that the appraisal profession is cloaked in a veil of secrecy and mystery for those not privy to its inner workings.  Most of the time appraisers have not been very good at communicating things either.  What I wanted to do today is address numerous items that may be helpful to you so that when the day comes for the appraiser to look at your home, you’re not chewing your nails the whole time he/she is there because you are not sure what matters and what doesn’t.  So lets take a look at what matters, and what doesn’t.

What Doesn’t Matter

• A good smelling house is nice but not a necessity.  You don’t want it to smell like a garbage dump but appraisers are taught to look beyond these “superficial” type things and focus more on the “bones” of the house.  So as long as the house smells decent don’t worry about burning that apple pie scented candle.
• Personal property items that can be removed are not included in the final value estimate.  I have covered this topic in a past blog post regarding utility sheds.  Other items that are not part of the valuation include refrigerators, washers/dryers and above ground pools.  If you have a question about an item I have not included here just give me a call.
• Like a good smelling house, a neat home is not a necessity.  The biggest concern of most homeowners (usually the Mom) is that their kids did not pick up their room for the appraisal.  A house that is a little messy will not hurt your appraisal.  On the other hand the degree of filth that a hoarder might have could effect the value.  Major filth can attract pests and rodents which is a whole other story.  You can read a past blog regarding this issue.
• Minor cosmetic improvements usually do not matter.  I was in a home one time where the owner followed me around pointing out all the knobs on the cabinet doors and electrical cover plates that she had changed out.  These types of things, while important to a homeowner, are not included in the appraisal.

What Does Matter

• Major improvements to the home does effect its value.  Appraisers should be told about things such as a new roof, heating and cooling system, new floor covering and renovated kitchens and bathrooms.  You may want to provide a written list of improvements of this type that you have made to the home within the past 3-5 years.
• Appraisers should have access to most sales information, however sometimes a sale might slip through the cracks.  Multiple Listing sales are the easiest to locate, however homes that are sold by owner (FSBO’s) can be hard to locate.  If there is a home in your neighborhood that sold recently that you want the appraiser to consider, by all means provide the information to him/her.  Let them know about the FSBO and MLS  sales.
• Appraisers are required to look at the past 36 months sales history of the subject property and we are required to report whether a home has been sold or listed.  Prior sales are considered within the framework of reconciling a final value for your home.  If you have purchased your home within this time period for a price that is below normal, such as from a family member or buying a foreclosure/short sale, it is good to let the appraiser know this.  This will help with underwriter concerns as well.  It will throw up a red flag if you buy the home for $100,00o and it is appraised at $200,000.  This may very well happen but the appraiser must explain it within the report.
• The condition of the home is important to the appraiser, especially items that affect the structural integrity of the home or its livability.  Items such as roof leaks, inoperable HVAC systems, leaking plumbing, non working mechanical systems and foundation problems to name just a few are all factored into the condition of the property and will have a major impact on its value.

I hope I have provided some insight into what we appraisers look at during an inspection.  By focusing on the items that really count you can insure that the appraisal inspection will go smoother.

If you have any real estate appraisal related questions you can call me at 205.243.9304, email me, or connect with me on facebook.