The Appraisal & Its Impact on the Home's Sale

by Connie Landes 03/15/2020

Image by Free-Photos from Pixabay

As the home buying process nears the closing, both buyers and sellers need to prepare for the appraisal. This often the last step the lender requires before approving financing for the buyer, so it’s an important part of the home sale process.

What is an Appraisal?

An appraisal is an unbiased, professional evaluation of the value of a home or other piece of real estate. It takes a look at the property, its physical characteristics and the local market conditions to determine the fair market value of a property.

How Is an Appraisal Different from an Inspection?

The appraisal is similar to an inspection, but it is a separate step. In an inspection, the inspector is looking at details about the home and its condition that make it safe or unsafe to live in. The inspector is also comparing the home to current building codes to make sure the home is up to current safety standards.

An appraiser is simply looking at the home’s market value. The appraiser has rigorous training to learn how to evaluate property values and puts that to work to evaluate yours.

How Does the Home’s Appraisal Impact the Home’s Sale?

Lenders want to know that they’re lending no more than the home’s actual value, because they don’t want to have a borrower upside down in a home loan at any point. If the home does not appraise for what the buyer is offering, the loan amount will not be approved. This either means the buyer can walk away or the buyer and seller can renegotiate the terms to match the appraised value.

How to Improve the Appraisal Value on a Home

Sellers who are worried that a home may appraise too low can take some steps to improve the appraisal value. Repairing cracks in the plaster or stains on the wall, for instance, before the appraisal can help improve its value. Odors and staining on the carpeting should also be addressed before the appraiser comes. Improving curb appeal and showing details about improvements and repairs that are high in value are also helpful in boosting the home’s potential value.

The home appraisal is a critical step, and often one of the last hurdles between initial offer and closing. Both sellers and buyers need to understand this step, so they can avoid unhappy surprises when the appraisal report comes back. If a home is competitively priced and well taken care of, the appraisal shouldn’t be a problem in the overall sale of the home.

About the Author
Author

Connie Landes

Connie Landes has a longstanding reputation as a Real Estate Professional who is committed to giving her clients the exceptional service they deserve. She uses her knowledge from 31+ years of experience, along with integrity, clear communication, tenacity, and, of course, humor to make her clients experience as stress-free as possible. Having lived and worked in Santa Cruz County for the last 30+ years, Connie has a real love for her community and the “Santa Cruz” lifestyle and loves to share her favorite places with her clients. Connie has experience in all areas of residential real estate, in Santa Cruz, Monterey, and Santa Clara Counties.

Professional designations: 

GRI (Graduate Real Estate Institute)

CNE (Certified Negotiation Expert)

SRES (Seniors Real Estate Specialist)

e-PRO (Internet Marketing Professional)

SCCP (Santa Cruz County Professional)

Santa Cruz County Assoc. of Realtors Realtor of the Year 2012

Santa Cruz County Assoc. of Realtors Community Service Award 2019 for "outstanding service & dedication to our community"

Trustee of the Santa Cruz County Assoc. of Realtors Housing Foundation

Member of California Association of Realtors

Member of National Association of Realtors