Owning a home can be quite a confusing process. Yes, owning your own home is the fulfillment of the American Dream and is a major accomplishment, but there still are many problems and pitfalls that come with it. You’ll have to deal with things like homeowner’s insurance and property tax, the less glorious parts of owning your own place. One thing that you might not be prepared for or even familiar with at all are home appraisals. Home appraisals can be extremely important when it comes to evaluating your assets and your financial future, so it’s important that you know what you’re dealing with. So what are home appraisals? How do they work, and how do you prepare for them? Here’s the ultimate guide to home appraisals.
Why Do You Need Them?
The first question you likely want to know about home appraisals is why they are even necessary in the first place. After all, why do you even need to have your home appraised? Home appraisals can be done for a variety of purposes, namely for insurance and sale. An insurance appraisal involves your home being appraised to determine the cost of replacing your home in case of fire or water damage. In contrast, a purchase appraisal is done to determine what price your home can command on the open market. An appraisal is supposed to be an unbiased estimate of what your home is worth, allowing you to make better and more advised financial decisions when it comes to your home.
Who Appraises?
Home appraisals can be extremely important, and as a result, not just anybody can complete them. A home appraisal can have a massive effect on your current and future financial situation, so it’s important that you have it done by a trustworthy individual. Home appraisals are usually completed by trained professionals who have undergone training to be certified to determine the value of a home. The vigorous training and certification process allows appraisers to have a deep understanding of what makes a home valuable and helps them make accurate estimations. If you want your home accurately appraised, you’re going to need to hire a trained professional.
What Are They Looking For?
Now that you know why an appraisal is done and who is doing it, it’s time to prepare for the actual appraisal. If you’re someone who is taking the beginning steps to buy a house or sell your home, then an appraisal’s value is likely going to be extremely important to you. Design aspects like furniture and decorations won’t have that big of an influence on the appraisal value, but the physical condition of the home will have a major effect. What’s the age of the home? How many square feet does the house encompass? What’s the location like? These are all questions that will be asked during your home’s appraisal, and the answers will have a major effect on how your home’s value.
How To Improve Appraisal Value?
If you’re someone that’s selling your home, then you’ll likely want to do whatever you can in order to improve your home’s appraisal value. Thankfully, there are several things that you can do to give your home a little boost before it is appraised. First, you should ensure that your home’s physical condition is top-notch. Doing so means that cracks should be sealed, leaks should be dealt with, and repairs should be made. In addition, homes that appear much newer and more modern will likely be appraised at a much higher value, regardless of their actual age. As a result, if you want to improve your home’s appraisal value, you’ll likely want to undergo renovations to fix any major problems your home has and make it appear more modern. Although these renovations may cost a decent amount of money, you’ll likely earn even more back from the improved appraisal value.
