More on real estate appraising

Real Estate Appraising is the act of valuing a property.

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It is carried out either by an estate agent to ascertain its market value or by a certified valuer to ascertain the value it could reasonably be sold at should the bank need to repossess it. The appraisal process itself is made up of both simple and complex calculations.

A certified property valuer, or accredited appraiser, uses a valuation model to determine the medium to low price the property will bring, should it need to be sold within the term of the mortgage.

It is essentially a risk assessment that gives the lending body an idea of the amount they should lend against the property.

If the mortgagee can no longer repay, the bank needs to recoup as much as possible on the loan as quickly as possible. (Often this means that a repossessed property will sell for less than a similar property)

An appraiser uses the most comprehensive property price information as well as certain statistical models to get an accurate end result. The models, especially in the case of a certified valuer, are based on:

  • Like Properties – property type, number of bedrooms, bathrooms, undercover or off-street parking, features such as security, views or solar heating and land size.
  • Recorded sales – appraisers will use sales records from previous months/years
  • Geography – to show the geographical layout of property values and to understand the influence of location on price
  • Confidence indicator - cross-checking with the current market trends.

To get the best results from your appraisal of real estate

To get the best results, focus on removing clutter, rubbish & bad smells!

Starting with the outside first …

  • Mow lawns and trim edges
  • Mulch your flowerbeds & weed everywhere else
  • Get rid of  rubbish, like old bikes, cracked flower pots, neglected chook yards or other fencing etc
  • Power-clean the outside of your house, including windows

Inside …

  • Clean the windows, sills and walls – a clean wall is often as good as a repainted one
  • Clean the house thoroughly, remove clutter
  • Make that bathroom shine!
  • Dust the blinds and clean the carpet
  • Air the house and make sure there are no smelly areas

For the buyer, it may be interesting to use the list above as a way to ‘deconstruct’ the value of a property when negotiating a price.

For instance, if the owner has made certain cosmetic improvements you could perhaps argue that they are superficial and therefore should not be considered as an added value.

Getting the best out of your real estate agent when selling

While you will meet professionals who know a lot more about buying and selling property than perhaps you do right now, in the end, the responsibility is still yours.

So, once you are sitting down with the agent at your appraisal of real estate who will assess the value of your property, what can you do to make sure you get the best result?

Here are a few things you can do to ensure your appraisal of real estate goes smoothly:

  • Manage your time: don’t allow the agent to control the meeting
  • Be consistent: you need to give each agent the same time, so spending three hours with one agent and half an hour with another will not give you the best comparison.
  • Interview more than one: To get the best idea of a fair value for your property, you need to interview a minimum of three agents
  • Strive for accuracy: have in mind a series of, say, five key questions that you will ask each agent. This is the only way to compare apples with apples!  You questions might be something like:
    1. How will you market my property?
    2. How will you calculate the value of my property?
    3. Offer a similar scenario, for instance, “if someone calls about my house, what are your steps?
    4. What is your commission and are you willing to negotiate on that?
    5. Do you have a buyer waiting?

Once the real estate agent or valuer is on their way, the most you can do to influence their idea of a fair price, besides being well prepared, will be cosmetic.

Even though you would expect an experienced valuer to be able to see past a well manicured lawn and clean windows, it is best not to underestimate the influence of a well kept property.

Before signing on the dotted line, always you should read our consumer reviews on who are the best agents, we can give you advice how to choose the best agents to interview.

We also have compiled consumer ratings scores on real estate agents in your area, search now for the best real estate agent just click on link at top of page.