5 Things To Consider When You Decide To Reappraise
When it’s time to sell your house or refinance your mortgage, reappraisal should be on your radar. Just because your bank appraised the house when you bought it doesn’t mean its value is the same — over the course of your ownership, many things could have happened to increase (or decrease) what it’s worth to lenders and potential buyers. The purpose of a reappraisal is to determine a fair market value. If you’re looking to sell or switch to a different interest rate, you’ll probably need to reappraise. Here are some things to keep in mind.
1. Sentimental Value Isn’t Value to Your Bank
Potential buyers might have a little patience for your insistence that your home has sentimental value — as a buyer, it can be nice to see that a home’s current owner has formed a strong bond with it. But an appraiser will not be impressed by your starry-eyed remembrances of beautiful Thanksgiving dinners or that time Uncle Ralph got stuck in the chimney. So keep the nostalgia to a minimum when the appraiser is in your house.
2. Appraisal Prices are Based on Recent Sales
Think of it from a bank’s perspective. If you were lending money for a home sale, wouldn’t you be more comfortable knowing how much you could sell it for now? Appraisals are based heavily on recent sale prices for homes in your area. Every neighborhood is a market, and though every home within that neighborhood has value, what’s important is the value of the homes that have sold recently.
3. You Get What You Give
That being said, your home’s value isn’t totally dependent on recent sales in your area, particularly if you’ve made improvements over the course of owning it. Major improvements to your home — a newly-remodeled kitchen, a finished basement, a new roof — can often increase its value, especially if those improvements are unusual for the neighborhood. Don’t embark on an ambitious project the day before the appraisal arrives, but if you’ve completed major work, make sure to let your appraiser know.
4. You’re a Great Resource
Before your appraiser arrives, do your research. Compile a list of other homes’ recent sale prices in your area. Note any similarities or differences your home has that could raise its value. Make a list of all improvements you’ve made since moving in, and include the cost to you. Do some research about your school district: Good schools can make an enormous difference in an appraisal.
And when the appraiser visits, don’t hesitate to share what you know. If you installed a new roof, tell the appraiser. If you installed solar energy panels on the roof, make sure he sees them. Let the appraiser know that you’ve done your research — and have put a lot of sweat equity into your house.
5. First Impressions Matter
All the home improvements in the world won’t matter if your home looks like a wreck. Prepare for an appraiser’s arrival the same way you would for a potential buyer: mop the floors and make sure everything is neat and tidy. Remember, too, that part of an appraiser’s job is to verify the fundamentals of your home: how many rooms there are, how many closets, etc. That means he or she will be going places you might not usually show a guest. So be sure that you can walk into your walk-in closet without tripping over a pile of clothes. And take a look around your basement to ensure that your appraiser doesn’t get a mouth full of cobwebs when he or she examines it. The last thing you want is for your appraiser to leave with a bad taste in his or her mouth.
Sam Radbil is a contributing member of the marketing and communications team at ABODO, an online apartment marketplace. ABODO was founded in 2013 in Madison, Wisconsin and now has apartment search engines for cities across the country including ABODO Philadelphia apartments.