Home Appraisal: More Than Just House Value
Most people, when buying a home, are first given a copy of the
appraisal at the closing table. In the excitement and stress of
signing the final mortgage papers, and arranging to get the keys
to the new house, the appraisal may be tucked away with the
other closing documents to be forgotten. There is information on
the report worth knowing.
The lender probably told you what the home value was soon after
the appraiser completed the appraisal. Now that you have a
written copy in front of you, it offers much detail, and tells
you a lot about your home that you may not have considered. When
you get home pour some coffee, pull up a chair and look it over.
The first several pages of the Uniform Residential Appraisal
Report offer an in depth profile of your property. The
neighborhood section will reflect the appraiser's analysis of
whether the housing trends around you are increasing stable or
declining in value. The high end and low-end prices and
predominate values are given. This may be important to you as a
benchmark to think about if you are planning to resell in the
next several years.
The section on improvements is where the appraiser gets to
observe the general condition of the home. The comments could
range from noting the upgrades such as new roof, interior
painting or new carpeting. The flip side would be warning about
lap siding now in good condition but subject to premature
deterioration. Any negative comments about condition may be
something that could be corrected by you to maintain or increase
value.
The page on comparable sales gives you the opportunity to see
the exact homes with addresses that your home was rated against.
You will read how the appraiser made the adjustments to each
home's value relating to square footage, rooms, garage, lot size
and a number of other line items to come to a bottom line. There
may be a page called "location map" that will have arrows
showing where each of the comparable homes are located. You
could take a little time and go for a leisurely drive to check
out the curb appeal of each of the homes.
These are just some of the highlights of the appraisal. In the
back pages there will be photos of the home and likely photos of
the comparable homes. The appraiser will go into more depth
relating to the neighborhood description, additional features of
the subject home and how the sales comparisons were analyzed.
There should be a page reflecting the floor plan of your home as
measured by the appraiser. In addition to the diagrams, there
will be the calculations for total area a breakdown of each foot
of living area. The appraisal will be a fairly complete picture
of your home and will give you a sense of what a financial asset
you really have.