When Do You Need a Property Appraisal?
What are the reasons for a real estate appraisal?
If you’re thinking about selling your home or an investment property, a property assessment is a great place to start. You can acquire a sense of the local market and figure out what is reasonable in terms of price. An excellent real estate agent will know the neighbourhood like the back of their hand and will have a lot of experience selling homes in the region.
A real estate appraisal is a real estate agent’s estimate of the worth of your property. Your realtor will conduct an appraisal to determine how much the property you want to sell will likely sell for in the present market.
In order to get an accurate appraisal of your home, your appraiser should meet the following criteria.
- How many years of experience does the real estate agent have?
- Is the appraiser familiar with your neighbourhood?
- Is their knowledge abreast of all the market trends?
- Has their selling expertise gained via auctions and private sales?
- Has the agent sold comparable homes to yours?
Property Valuation versus Real Estate Appraisal
The main difference is the licenced valuer will charge you a fee whereas a registered real estate agent will perform the appraisal free of charge. When it comes to selling your home, you’ll want to be sure you acquire an accurate assessment of its value before you put it on the market. A free market evaluation from a local real estate professional will help you do so. You may pay for a professional valuer to come to your house and give you a property valuation if you’re searching for a precise value. In most cases, your real estate agent will base your evaluation on a future date. This is due to the fact that you will most likely sell within a month of receiving your property value. This indicates that the market’s direction will have an impact on your agent’s assessed worth.
An appraisal serves as a reference or estimate for pricing. A property valuation, on the other hand, maybe utilised to determine a definitive value. Settlements, securing a loan for finance and determining the worth of a deceased estate can all benefit from valuations.
3 other reasons you may want a property appraisal
Apart from buying or selling a home, there are other circumstances in which you will want to acquire an appraisal on your home.
1. Refinancing your home loan – When you refinance your house, you’re essentially replacing your previous mortgage with a new one since the value of your property may have increased since you initially purchased it. As a result, lenders will want an evaluation to confirm that the new mortgage amount is justified by the current value of the home. If the value of your house has improved since you bought it, you may be allowed to take cash out as part of the refinancing process. If it has dropped, though, you may have problems obtaining a new loan.
2. Acquiring a home equity loan – Home equity loans, unlike refinancing, are a second loan on top of an existing mortgage. The amount you may borrow with a home equity loan is mostly determined by how much equity you have after subtracting the outstanding value of your mortgage from the current worth of your property. You may not be qualified for a home equity loan if the value of your property has declined.
3. Applying for further loans – You may be required to use your house as collateral for other sorts of loans, such as cash and business loans. The bank will want to make sure that the money it provides is backed up by the current worth of your house, much like with home equity loans.
