The 25 Most Common Questions About Residential Appraisals (and Their Answers!)
Welcome to the ultimate guide on residential appraisals! Whether you’re buying a house, selling one, or just curious, you’ve come to the right place. We’ve rounded up 25 of the most frequently asked questions about appraisals and answered them in a way that’s easy to understand. Let’s dive in!
An appraisal is when a professional, called an appraiser, looks at a home and estimates how much it’s worth.
Appraisals help buyers, sellers, and lenders make sure the home’s price is fair.
Usually, the lender hires the appraiser. If you're buying a house, this means your bank or mortgage company.
They look at things like the size of the house, the number of bedrooms and bathrooms, the condition, and recent sale prices of similar homes nearby.
They’ll check the home’s layout, features, condition, upgrades, and any problems, like a leaky roof or cracked foundation.
The appraiser’s visit usually takes about 30 minutes to an hour, but the full process can take a few days.
Appraisals typically cost between $300 and $600, depending on your location and home size.
The buyer usually pays for the appraisal as part of the closing costs.
Not really. Lenders pick an appraiser from a neutral list to ensure fairness.
If the appraisal is lower than the agreed price, the buyer and seller may need to renegotiate or the buyer might need to make up the difference.
Yes, if you’re the buyer, you’ll get a copy from your lender.
Appraisals are usually valid for 3 to 6 months, but it depends on the market.
An appraisal determines the home’s value, while an inspection checks for problems like faulty wiring or plumbing issues.
Not really. The appraiser focuses on the home’s features, not your clutter.
Yes, especially major upgrades like a new kitchen or bathroom. But not all renovations add equal value.
Yes, the outside of your home and landscaping can impact the value.
Yes, you can appeal by providing evidence, like recent sales of similar homes, to support a higher value.
Yes, they usually know the agreed price but still assess the home’s value independently.
An appraiser will still visit and determine your home’s value for the lender.
Absolutely! Values can go up or down based on the market and the condition of the home.
No, but it’s a good idea to make sure you’re paying a fair price.
It’s a recently sold home similar to yours in size, condition, and location. Appraisers use these to estimate your home’s value.
Yes, appraisers look at whether home prices in your area are rising, falling, or staying the same.
Congrats! That’s good news for the buyer, but it doesn’t affect the agreed price.
Yes! Fix small repairs, improve curb appeal, and clean up to make a good impression.
Final Thoughts Residential appraisals might seem a little intimidating, but they’re really just a way to make sure everyone gets a fair deal. Now that you know the basics, you’re ready to tackle the process with confidence!
Crafting a Successful and Fair Reconsideration of Value Request
As a real estate agent, you are often at the intersection of buyers, sellers, and the appraisal process. Sometimes, the appraised value of a property may not align with expectations, potentially jeopardizing a transaction. When this happens, submitting a reconsideration of value (ROV) request to the appraiser can be an effective tool—when done correctly. Below are key insights from an appraiser’s perspective to help you craft successful and fair ROV requests that increase the chances of a favorable outcome.
Understand the Appraiser’s Role Appraisers are impartial third parties tasked with providing an unbiased opinion of a property’s value based on market data. Their duty is to the lender and regulatory guidelines, not to the buyer or seller. When submitting an ROV, consider you are opening a professional dialogue with a real estate colleague.
When to Request an ROV An ROV is appropriate if you believe there are inaccuracies or omissions in the appraisal report, or if additional comparable sales (comps) were overlooked. Examples include:
How to Structure an ROV Request
After Submitting the ROV Once your ROV is submitted, the appraiser will review your materials and determine whether any adjustments are warranted. Keep in mind:
Conclusion A well-crafted ROV request can be a powerful tool in resolving valuation concerns, but it requires precision, professionalism, and respect for the appraiser’s role. By focusing on relevant data and presenting your case clearly and courteously, you can help ensure that the appraisal process supports a fair and successful real estate transaction. Collaboration and understanding between agents and appraisers ultimately benefit all parties involved.
Final Thoughts Having a professional, proven, local appraiser in your agent toolbox benefits all parties. Find your person! There are many appraisers who are willing to connect and spend a few moments talking through a challenging listing. Providing your CMA before or at the inspection can be helpful particularly for unusual or feature-rich homes. And lastly, hiring an appraiser to write your ROV is also an option.
Personally, I have shared with agents how to submit ROVs on my very own appraisals. It is just another part of the process, and everyone has a right to double-check the work. On more than one occasion I did not include the ROV provided sales as they would bring the value down and the subject would not meet contract. On several occasions the agents learned something new. Rarely, but it has happened, I miss something, and the value gets bumped up. I apologize and move on. We’re all human at the end of the day!
Sunny@embraceappraisal.com
https://www.embraceappraisals.com/