Basics to Understanding a Home Appraisal Report
Monday, July 13, 2015
Though the duties between a real
estate agent and an appraiser do differ, the two
professions will often be working in the same line of business: with properties.
Real estate agents aren’t just limited to residential properties, and neither
are appraisers or assessors (case in point, the Lexur Appraisal Services team). However, in one portion of the buying-and-selling process, real
estate agents aren’t the experts to
contact when you have a question about the appraisal report. The overall appraisal report can be
confusing, especially when you aren’t knowledgeable in every aspect of the
assessment industry. However, breaking it down can be simple, and it can
help you further understand how the assessor determined the property value in
In a typical appraisal report, the
assessment should be broken down into multiple separate sections showing how
the appraiser came to determine the value of a particular property. For homes,
the appraisal report is typically sectioned with three common features, and
maybe more: property facts, comparable properties, and the estimated market value of the
property. As basic and straightforward as that information sounds to be, the
appraisal report is customarily requested on behalf of the lender. Thus, the
appraisal report is written for the lender, primarily in order for this lender
to determine a fair property value and see how much money they should lend to
you, the seller of the property.
However, once the appraisal report
is delivered to you (and to the lender), knowing how the report is written and understanding
the information it consists of, are two completely different concepts. In order
to understand how an assessor determined the estimated market value of your
property — specifically in this case, a house — it needs to be broken down
or Property Facts
section will list specific identifying characteristics of your property or
home, and any improvements that have been made to it.
portion of information this section will contain is the neighborhood,
community, metropolitan area, etc. that the home is located in. Why is this
needed? It helps identify similar properties or houses that yours can be
compared to, which brings us to the next section. …
Properties or Homes
homes are usually those within the same neighborhood, community, metropolitan
area, etc. that have been sold within the last six months.
assessor who completes your appraisal report will list each of these comparable
homes with their estimated market value (most likely determined by another
assessor) and how much each home actually sold for.
in order to give the best-estimated market value for your house, some
adjustments to these comparable homes may be made. This may or may not affect the
worth of your property on the appraisal report, but it can sometimes be complicated
to find comparable homes, as each and every property is distinctive.
important thing to remember about this section is that it is the one the lender
typically bases their decision upon of how much money they will lend you during
the buying-and-selling process.
the appraisal report, this section lists how much the assessor feels your
property or home is worth.
property value is the value lenders will use to determine how much money they
will lend to you.
the section for the estimated market value, the estimate listed also is used for
the loan-to-value ratio.
Depending on what type of property
you’re having undergo the appraisal process, the appraisal report can include
numerous other facets, and can be even more detailed than the one an assessor
conducts for a home appraisal. For more detailed appraisal reports, these
reports can go as far as providing more information on comparable properties,
or inform the lender how much it would cost to replace the entire property,
otherwise known as cost value.
Appraisal Services today if any of the many services we offer
can be beneficial to your property.
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