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Wednesday, January 23, 2019

3 Key Components Of A Home Appraisal


What are the 3 key components of a home appraisal?

 
A home appraisal consists of these three components:
1. A Physical Examination of the Property:
The physical inspection at the house may take an appraiser as little as 30 minutes to perform or could take as long as two to three hours. This depends on the size of the house, known as Gross Living Area (GLA) and also the design of the home. An artsy Contemporary style home takes longer to measure than a standard rectangular Colonial home. Physical visits are usually brief when a home is in average to very good condition. 


2. Selecting Comparables:
Next, finding the most recent/similar sales that are located approximately within a mile of the property, and that have closed within the past 6 months, are what every appraiser is seeking! These properties are used to establish an accurate opinion of value. The appraiser will locate the most appropriate and comparable sales to be included in his appraisal report.


3. Completing The Appraisal Report:
After a thorough physical examination of the property and  locating the best comparable sales available, the appraiser will start entering all of this data into a standard appraisal report form. Once all of the data is entered, the appraiser evaluates all of this information so he can arrive at his final estimate of market value. Fortunately, almost all residential properties require only short form reports, usually 10 pages or less. Appraisers often can complete a report in about 5 hours. Depending on the appraiser's workload and on the complexity of the property, an appraisal report should be completed and delivered to the lender in about a week.  Rush appraisals are done quicker when requested.


Info taken from "Norman, Hubbard and Associates".

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