Are you in the market for a new home in Texas? If so, it’s essential to understand appraisals and market value when preparing for your purchase. To help you make an informed decision, here are some frequently asked questions that will give you valuable insights on finding the perfect place.
What is an Appraisal?
An appraisal is an estimate of the value of a property by a certified professional. A home appraisal helps lenders determine how much they will loan to potential buyers and helps buyers protect themselves from overpaying. It also gives lenders confidence when giving out mortgages.
How Does a Home Appraisal Work?
The appraisal process typically begins with an inspection of the home. The appraiser then evaluates the property’s condition, compares similar homes nearby, and assesses market values to calculate the home’s estimated market value. The appraiser may also consider any recent improvements or renovations made to the property.
What Factors Impact Home Appraisals?
When appraising a property, several factors can influence its value. These include square footage, location, age, home condition, amenities, updates, and other characteristics affecting value. Additionally, external factors such as neighborhood market trends and housing prices can play a role in determining the appraised value of a home.
Can I Appeal an Appraisal?
If you feel like an appraisal was inaccurate, you can appeal it. Most lenders will accept requests to review appraisals if sufficient evidence proves the value was miscalculated. Be sure to speak with your lender about your options before moving.
Is Market Value Different than Appraised Value?
Market value is the amount of money someone is willing to pay for a house at any given time and is determined by current market conditions. It often differs from the appraised value based on past market analysis rather than current trends. However, when both are considered simultaneously, they can provide more clarity on the actual worth of a property.
What is the difference between market value and appraised value?
The appraised value is a certified appraiser’s opinion of a home’s worth at a given time. Lenders require appraisals as part of the loan application process; fees range from $200 to $300.
Market value is the price the house will bring at a given time. A comparative market analysis is an informal estimate of market value based on sales of comparable properties performed by a real estate agent or broker.
How do you find out the value of a troubled property?
Buyers considering a foreclosure property should obtain as much information as possible from the lender about the range of bids being sought.
It also is important to examine the property. If you cannot get into a foreclosure property, check with surrounding neighbors about the property’s condition.
It also is possible to do your own cost comparison by researching comparable properties recorded at local county recorders and assessor’s offices or through Internet sites specializing in property records.
What are the standard ways to determine what a house is valued at?
A comparative market analysis and an appraisal are how consumers, lenders, and realty agents determine what a home is worth.
Your real estate agent will happily provide a comparative market analysis, an informal estimate of value based on comparable sales in the neighborhood. You can also research “the comps” by checking on recent sales in public records. Be sure you are researching properties similar in size, construction, and location.
This information is available at your local recorder’s or assessor’s office, through private companies, and on the Internet.
An appraisal, which generally costs $200 to $300 to perform, is a certified appraiser’s opinion of the value of a home at any given time. Appraisers review numerous factors, including recent comparable sales, location, square footage, and construction quality.
What’s a house worth?
A home is worth what someone will pay for it. Everything else is an estimate of value. Most people use an appraisal or a comparative market analysis to determine a property’s value.
An appraisal is a certified appraiser’s estimate of amenities, energy efficiency, and the quality of a home’s value at a given time. To determine, appraisers consider square footage, construction quality, design, floor plan, neighborhood, and availability of transportation, shopping, and schools. Appraisers also consider lot size, topography, view, and landscaping.
A comparative market analysis is an informal estimate of market value based on comparable sales in the neighborhood performed by a real estate agent or broker. You can do your own cost comparison by looking up recent sales of comparable properties in public records. These records are available at local recorders or assessor’s offices, through private companies, or on the Internet.
What standards do appraisers use to estimate value?
Appraisers use several factors when estimating value, including historical records, property performance, condition of the home, and indices that forecast future value. For detailed information on appraisal standards, contact the Appraisal Institute at 875 N. Michigan Ave., Suite 2400, Chicago, IL 60611-1980; (312) 335-4458.
What is the return on new versus previously owned homes?
Buying into a new-home community may seem riskier than purchasing a house in an established neighborhood. Still, any increase in home value depends upon the same factors:
- the quality of the neighborhood
- growth in the local housing market
- the state of the overall economy
One survey by the National Association of Realtors shows that resale homes have an edge over new homes. The trade group’s figures show the median price of resale homes increased by 3 percent between 1994 and 1995, compared to 0.8 percent for new homes in the same period.
What is the difference between list price, sales price, and appraised value?
The list price is a seller’s advertised price, usually only a rough estimate of what the seller wants to get. Sellers can price high, low, or close to what they hope to get. To judge whether the list price is a fair one, be sure to consult comparable sales prices in the area.
The sales price is the amount of money you, as a buyer, would pay for a property.
The appraisal value is a certified appraiser’s estimate of the worth of a property, and is based on comparable sales, the condition of the property, and numerous other factors.
Can I find out the value of my home through the Internet?
You can get some idea of your home’s value by searching the Internet. Several Web sites and services crunch the numbers from historic public records of home sales to produce the statistics. Some services offer an actual estimate of value based on acceptable software appraisal standards. They also depend on historic home sales records to calculate the estimate.
Neither of these services produces official appraisals. They also don’t factor in market nuances or other issues a certified appraiser or real estate professional might have in assessing your home’s value.