08 Nov Factors that impact a home appraisal
You know by now how important it is to get pre-approved for a mortgage. You also know it can be difficult to accomplish due to the number of “items on the check list”. One of the many documents a lender analyses before agreeing to give money to someone to purchase a home is the appraisal document. This one is typically required by lenders who want to see an assessment of the value of the property according to current market conditions. See our blog post on appraisals.
So, what items or factors can impact a home appraisal?
Why is this so important? For the simple fact that it indicates how much a house is worth and how long it will take to sell, if one decides to sell it. This is the reason why the appraiser looks at the house and at the neighbourhood.
This is important as to have a precise idea of livable spaces of the home, as well as the number of storeys.
How many bedrooms and bathrooms?
The property is compared to others by the appraiser and the number of bathrooms and bedrooms will help compare the value of the home in question. The higher the number of bathrooms and bedrooms, the higher the appraisal value.
Renovations and Improvements
Depending on what is being renovated, the value of the home can go up. For example, a new kitchen can add value to a property.
Age of the home
Just because a home is newer doesn’t necessarily mean it has a greater value. Newer homes have more modern finishes and don’t require many repairs. However, older homes have some great features as well.
Current housing market
The overall real estate market always plays a part in the appraised value of a home, especially whether or not that market is a sellers or a buyer’s market.
For more on this, get a copy of Carmen Costa’s book “The Reality of Mortgages”.