An appraiser arrives at your home. What do you expect? In a real estate market such as we have experienced in the last couple of years, appraisals have become and will continue to be a more familiar process to buyers, sellers, and those refinancing their homes.

An appraisal, simply put, is an opinion or conclusion of value.  The appraisal is developed by finding sales of properties that are comparable or similar to the property (subject) being appraised.  That is, the comparables used should be the most similar sales available to help approximate the value of the subject.  The sales should be similar with respect to the nature, quality, market area, and ownership as well as other specific factors such as size (living area), bedroom count, bathroom count, etc.

An appraisal is based on much research in the suitable market areas of the real estate being appraised.  Information is assembled and analyzed during the appraisal process.  Using their knowledge, professional judgment, and experience in the property type being appraised, the appraiser arrives at a value conclusion after making necessary “adjustments” to the comparables selected.

During the site visit, certain data must be collected about the subject.  The appraiser will measure the improvements and note room locations.  Depending on the instructions to the appraiser, more details may be required such as room sizes.  Certain features of the property will be noted as well as their condition.  Some such features are the roof, exterior and interior walls, flooring, etc.  Exterior pictures of the subject will be taken.  Interior pictures may be taken as well to document the condition of the subject at the time of the appraisal site visit.

To assist the appraiser in the appraisal process, the following documents will be useful to have on hand when the appraiser arrives:

• A plot plan or survey of the property and house
• A copy of the deed or Cash Sale.
• Any information on the sale of the property within the last three years.
• Written instruments that convey any right of ways such as shared drive ways, etc.
• Any title analysis that identifies any encroachments onto the property.
• A list of any personal property to be sold with the home.
• Any inspection reports such as home inspections, termite inspections, or engineering inspections.
• A copy of the most recent Tax Assessment bill.
• A copy of the current listing agreement and the broker’s data sheet.
• A list of the major improvements, their costs, and the dates installed since you have owned the property. These items may include the installation of a new central HVAC system, new roof, re-wiring, ceramic tile, or a kitchen renovation.

Although it is not required that the above documents be on hand, it certainly assists the appraiser by allowing them to get a much more complete “picture” of the property being appraised.  Also, it is not necessary for the homeowner or their designated agents to accompany the appraiser throughout the site inspection process but they should be available to answer any questions and point out any major improvements from the list they have provided.

There is much more to the appraisal process than what there is space for in this article.  But the above information should give you a general overview of the process.  Different appraisal assignments may dictate variations from the above described process.  We hope the above information was helpful!

Click here for Appraisal Site Visit – What to Expect in pdf form.

Today an associate and I were discussing various topics dealing with appraisals and the subject came up on when to classify a property as urban, suburban, or rural. My associate conveyed an explanation that he had heard from an instructor at a continuing education class and I thought that it was a great explanation. Refer to the figure below when reading the explanation.

In the illustration above, Anytown, USA is an incorporated area. This area is considered urban due to its status.? Any subdivision or house located inside the boundaries of Anytown, USA’s corp. limits is considered urban. On the other hand, the adjacent subdivision is considered suburban. This is logical and makes pretty good sense since the adjacent subdivision is not contained within the boundaries of Anytown, USA. Any house in any adjacent subdivision or any subdivision whose boundary touches Anytown, USA, would be considered suburban.

The next classification is rural. As you can figure, rural is any house or group of houses not in an incorporated area and not in a subdivision adjacent to an incorporated area. This is shown as an outlying house or houses on the figure above. An interesting point to make is that an outlying house considered rural could become suburban or urban for that matter. An urban conversion is pretty straightforward: the house or houses would have to be included in an incorporation.Suburban classification can happen when a development begins outside an urban area and develops toward the incorporated area until it touches.? Many times this contiguous line of houses would be considered suburban.? The suburban classification would definitely hold if the whole area were grouped into a formal subdivision.

Hopefully this explanation clarified this topic for most who read it. As with any “rule” there are exceptions. But generally speaking, the above explanation works.

Not long ago I watched a video on YouTube.com about real estate agent safety. I believe this video was sponsored the Realtor Association but, unfortunately, I cannot find the web link. I thought it was a good watch for anyone who deals with the public one on one. The video was targeted mainly at women but is worthwhile for men to watch as well. Here are the main points of the video:

1. Trust Your Instincts – If the situation doesn’t feel right, it probably isn’t. Don’t go into situations or remove yourself from situations that do not feel right.

2. Ask Prospects To Come To Your Office First – Many times this suggestion may scare away anyone up to no good. The only drawback is that meeting at the home may be the only option.

3. Never Travel In Prospects Vehicle – Unless you know your client or potential client, NEVER travel in their vehicle. Always take your vehicle and arrive earlier than your client to familiarize yourself with the area and open up the home if possible.

4. Park In A Well Lit Area – If possible, meet the potential client during the daylight hours. If it is near dark or dark, always park in a well lit area.

5. Dress Conservatively & Professionally – Revealing or suggestive clothing may be viewed as an unspoken invitation for something more.

6. Keep Your Cell Phone Nearby – Program your office’s number into your phone with a one number speed dial and keep your cell phone handy throughout the meeting.

7. Tell Co-Workers Your Schedule – Always let several of your co-workers and family members know what your schedule is like. Give them the address and times and ask that they check on by a phone call.?

8. Buckle Your Seatbelt While Traveling – Okay, this is a pretty obvious one but many times, in a hurry, an event that we may forget.

9. Be Aware of Your Surroundings – Get to the appointment early and survey the area. Plan potential escape routes for yourself.

10. Always Allow The Client or Prospect To Go Ahead of You – Keeping the client ahead of you can allow you to make a life saving move in the event you are threatened.

While looking for the original video that I watched, I came across a document from the Louisiana Realtor Association – http://www.larealtors.org/pdf/safety.pdf? This is a good read as well.

Are you selling your home and have the jitters; concerned that your home will not pass the inevitable home inspection that looms on the horizon? If the answer is yes, this article is for you!

In short, here is one tried and true remedy – preparation.  Just as with any other “test”, you must prepare. Trying to hide or cover up issues is no way to sell a home. Repairing the deficient items or making monetary concessions with the buyer are the only responsible actions.

Aside from being morally wrong, attempting to hide or cover up problems with your home can decrease or eliminate the trust factor between you and your potential buyer. That can be one sure-fire way to ruin the sale of your home!

Failing A Home Inspection

Now with that out of the way, let us dispel a myth so-to-speak: Homes do not pass or fail a typical home inspection. The home inspection that we will discuss in this article is not a code inspection.  Code inspections are generally performed when the house is being constructed or having major renovations performed.

Home inspectors look for items that are installed incorrectly, that may be potential health or safety issues, or any number of other deficiencies in the major system of a home. The home inspection is typically a non-invasive and visual inspection. What the inspector cannot see (such as behind walls or beneath the ground) is not inspected. The home inspection gives the customer a better picture of the structure’s overall health.

The typical home inspection is conducted after a buyer signs a purchase agreement. The buyer is the home inspector’s client. The buyer or the buyer’s real estate agent will arrange a time that the inspector can view the home to perform the inspection. After the inspection, either on site or a day or so later, the home inspector will submit a report of his or her findings to the client. These findings, if severe enough, could jeopardize the sale.

It only makes sense to identify potential issues before they are a “surprise” to everyone. A Pre Listing Home Inspection is a wise investment for the seller and also an act that shows the buyer you have done your homework.  A Pre Listing Home Inspection is money well spent.