A new national report is stating that homeowners are anticipating higher appraisal values than they are getting.
The report states that this could be related to decreasing home prices and a widening difference between estimates and true values. Specifically, across the country, appraisals came in 0.78 percent below what sellers expected in March, a .28 percent increase from the previous month. In addition, the report states that many buyers may have decided to wait out buying until more inventory opens up.
Considering this gap in expectations, it is important for Seattle/Renton/Tacoma homeowners (and homebuyers) to understand what exactly goes into an appraisal.
Below is some general information about appraisals.
A home appraisal is an unbiased analysis of what the value of a house is conducted by a professional appraiser who has been trained and gone through testing to earn qualification to do such a job. A lender will typically order the appraisal while the loan process is underway as a way to nail down an accurate market value of the house. This is to ensure the loan amount is sufficient.
Your next question may be, well what goes into the appraisal analysis? It can include things such as the condition the house is in, neighborhood, comparisons to values of nearby homes and more.
Keep in mind that appraisers are not interested in any of the furniture or how you have your home decorated, they are interested in the condition of the physical property itself, dimensions, size, lot size and how the home has been maintained. Things such as water stains, damage from pets, overgrown landscaping, cracks in molding, etc., is what will be noted.
Homeowners are able to challenge the results of an appraisal. Any such challenge can be communicated to the lender and any action that needs to happen can take place through them.
Appraisals are important in order to make sure the stakeholders involved are participating in a transaction that is fair based on the real estate market at that time. If you have any questions about appraisals or the home loan process in general, make sure to reach out to us and we can help you out.