Understanding Home Appraisals Part One

Admin — Tue, 01 Sep 2009 16:21:40 +0000

Understanding the real value of a home, office building, or business location is important. This value is calculated by alot of different methods and it really depends on alot of different things an appraiser will have to look at. Given the fact that no two properties are alike, the appraiser needs to take into consideration the end use of that property, meaning what the buyer will use it for. One of the most important factors of a home appraisal is the location, as the common phrase goes – “location location location” is key. This sole fact will determine most of what the property is worth. The sheer possibilities of the property’s location can determine whether the property is worth $100,00 or one million dollars regardless of the condition of the building itself.

Appraisals are done according to the condition of the property itself, which is often confused with an inspection. An appraisal and an inspection are two totally different things. Especially if you are making a purchasing decision from neither of the documents, knowing the difference between the two is crucial for carrying out an educated decision. An inspection is usually dedicated to the physical appearance of the property, the structure’s strength, and it’s compliance with city and state building codes. On the other hand, an appraisal is focused on the financial aspects of the property, it calculates the worth of the home, taking into consideration it’s location, amenities (pool, screen, garage, etc) and some of the defects brought out by the inspection. There are instances where the appraiser may refer to the inspection’s results, but it isn’t mandatory.

Read Part Two…

ParadiseHomes.com » how appraisals work

Understanding Home Appraisals Part One