Typically, home appraisers use the Sales Comparison Approach to determine current market value of your home. The Sales Comparison Approach involves collecting information on recently sold homes (ideally sales that have closed within the past 90 days) that are similar to the house that is being appraised.
We select comparable homes that are the most similar to the Subject property in terms of location, livable area (SqFt Under A/C), room count, age, condition, upgrades, site size, view (Lake, Golf Course, Ocean, Etc.) and amenities such as a pool and/or garage. We find these recently closed comparable sales by researching the M.L.S. also known as the Multiple Listing Service (This is the Realtors System used to list and sell real estate) and Tax Records. From this research, we narrow down the recently sold comps to a minimum of three sales that are the most similar to the property that is being appraised and put the comparable sales into the home appraisal report.
Positive and negative adjustments are made to the comparable sales for differences between them and the Subject (Such as for Condition, Upgrades & Livable Area). From this, we get the adjusted sales prices of the comparable sales and the appraiser reconciles these adjusted values to determine the final home appraisal value
How are homes appraised?
Steps Taken to Determine Property Values:
Research the market to obtain information pertaining to sales, listings, pending sales that are similar to the subject property.
Investigate the market data to determine whether they are factually correct and accurate.
Determine relevant Homes of comparison, and develop a comparative analysis for each.
Compare the house being appraised to comparable home sales according to the elements of comparison and adjust as appropriate.
Reconcile the multiple value indications that result from the adjustment of the comparable sales into a single value indication.
As a rule of thumb, the house appraisal should be somewhere between the sale prices and the adjusted values of the comparable sales used in this report. Please feel free to call us at 843-808-1533 if you would like a further explanation on real estate appraisal process.
Getting The Most Out Of Your Home Appraisal
If you are trying to achieve maximum market value for your property, there are a few things to consider BEFORE hiring an appraiser. Since the overall condition of a home will impact the appraised value, performing minor and major repairs prior to scheduling an appointment is a good idea.
Some of the easiest way to improve the overall condition and appearance of the home would be things like interior and exterior paint as well as having carpets and flooring thoroughly cleaned. Also, crown molding is a fairly inexpensive and impressive looking upgrade that can be done over a weekend.
More costly issues such as poor roofing, foundation problems and damaged siding should also be considered in your repairs list. These items will have a great negative affect on values because they are considered condition issues, not just quality of construction.