Top 5 Ways to Increase Your Home Value Appraisal
Even if you don't know exactly what a home appraisal is, you can guess that it's an important part of the selling process. In fact, a home value appraised by a licensed professional is perhaps the most important part of the process.
If your home appraisal does not support the sales price, banks and lending companies simply won't want to do business. Most real estate contracts contain a clause that allows sellers to void the deal if the appraisal is too low and they are unable to receive financing.
It's rare that residential real estate transactions are done with cash only. Some form of financing is usually required. It's unfortunately common that sellers are surprised by a lower-than-expected appraisal, sometimes due to reasons that they could have addressed before the appraisal took place.
Thankfully, there are things you can do to increase the value an appraiser declares for your home. Make sure you've taken these steps before putting your home on the market:
1. Fix Broken Systems
Replacing burnt-out lightbulbs may help give the impression that your home is well maintained, but home appraisers check much more than that. They will flick every light switch and test all systems in the home to see if everything works. If not, that may present a reason to lower the home value. Simple fixes that cost you a little can save you a lot when it comes to determining the value of the home.
You likely already know what does and doesn’t function properly in your home. If not, go around your home with a notebook and a critical eye. Pretend that you're a home appraiser and conduct your own inspection. Determine if the problems are things that can be easily fixed with a weekend project, and complete the work before any inspections are conducted.
2. Clean Up Old Messes
It doesn't take long for an abandoned project or accident to blend into the woodwork of your home — especially when you're busy. Before the home appraiser is scheduled to make an in-person visit to your home, you'll need to conduct a major clean up. The cleaner and less cluttered a space is, the better your home value will be. Donate or sell old clothes or furniture, and finally go through that big pile of papers.
A home appraiser won't judge you or expect you to be a perfectionist. But think about it: messes certainly won't enhance your home value. Plus, you may discover some other things, such as infestations or unsightly paint, that could be addressed before the inspection.
3. Make Time for Landscaping
If your home is surrounded by a yard, make some time for yard work before the appraisal. The home appraiser won't just review all the systems inside the house. They will also walk around the entire property.
They'll be taking notes about old debris and piles of dead leaves. Anything unsightly or potentially concerning with regard to the home's foundation should be tended to by either you or a landscaping professional. Just like inside, you may find other issues on the exterior of your home worth addressing before the home value appraisal.
4. Check in with Your Neighbors
Your own home and land aren't the only things that home appraisers consider when determining the value of your property. They also will look at your neighborhood and community. If your next-door neighbor isn't maintaining their yard, consider discussing the issue with them, or perhaps local code enforcement officials. If the area doesn't look good, do what you can to improve the aesthetics.
Sometimes unsightly issues that may impact home values have nothing to do with your direct responsibilities, but taking care of them may be worth your efforts. If a nearby lot is strewn with litter, an afternoon of filling trash bags will ensure the eyesore doesn't leave a bad impression on a home appraiser. If the issue could be a problem for the buyer, think of ways within your power to address it beforehand.
5. Be Present During the In-Person Inspection
On the surface, the home appraisal process doesn't have much to do with the seller. It is designed as a kind of insurance policy the lender has when agreeing to underwrite a mortgage for the property. In fact, most of the time it's only the lender and the buyer who receive a copy of the home appraiser's report. That's why this is often paid for by the buyer.
However, home sellers or their agents would be wise to attend the in-person review by the home appraiser. By walking through your home with the licensed professional, you'll be available to answer questions and point out features that may otherwise go unnoticed.
Of course, they have certain things they focus on in their work. But sometimes, they may neglect to include amenities like a pool or porch that may influence the home's value. Pointing out the positives of your home can't hurt, as the appraiser considers all aspects of your home when compiling a final report.
Ask Questions of the Home Appraiser
Once the report on your home value is complete, you won't have an opportunity to dispute it. That's why it's so important for homeowners looking to cash in on their real estate investments to do some work before moving forward with an appraisal. You'll feel more confident when the in-person inspection takes place if you've taken care of any maintenance and cleaning issues.
When the home appraiser is on-site, don't be afraid to ask a few polite questions. Understand what they are looking for and thinking as they evaluate your property. As professionals, they have seen a lot of homes and know how yours compares. They should be able to easily explain their process, so there should be no surprises for you, the lender, or the buyer.