Real estate appraisals help set a value for your Temecula, California home. Appraisers will look through your home, your property, and all other buildings contained therein to set a proper market value. Some people think that an appraisal is the same thing as a home inspection, but they differ heavily. An inspection is designed to tell the buyer about the condition of the home, while an appraisal creates a property value for the lender.
This is just an example of one of the myths surrounding appraisals. Not a lot of people truly understand real estate appraisals, so in this article we’re separating appraisal facts from myths. Here are a few:
Myth 1: Appraisals are Made to Save Buyers Money
One appraisal myth is that an appraisal is designed to help save the buyer money, by making sure they don’t pay too much money for the home. This is simply not the case. The purpose of an appraisal is to protect the lender, not the home buyer. Yes, appraisals can help buyers and sellers understand the real estate property more fully, but the appraisal is designed to help avoid excessive money lending. That is why appraisals always occur before the loan is approved.
Myth 2: Appraisers get the Final Say on Your Home’s Value
Another common myth about appraisals is that the appraiser has the final say on the value of the home, regardless of the purchase price. Many people believe that if the home is appraised lower than the purchase price, then the home won’t be available for the buyer. Sometimes, the seller may be willing to lower their purchase price, simply to get rid of the property. Buyers can also make a big down payment to offset the difference. Sometimes, a repair escrow account will be used to fund repairs that help boost the value of the home.
Myth 3: Appraisers Use a Formula to Gauge a House
Some homeowners mistakenly believe that an appraiser uses a specific formula to value the home. Examples of potential formulas include a “price per square foot” value, that is set before the home is even appraised. This is an obvious fallacy. There are dozens of different considerations that go into appraising a home’s value. Some of these values include: access and proximity to public facilities (such as schools), the size of the lot, the condition of the home (including its construction and utilities), recent sale prices, proximity to undesirable locations, and much more.
Myth 4: Clean Houses get a Better Appraisal
Many people will go crazy cleaning their home just before an appraisal, as they think a clean home will be valued more highly. This logic makes little sense. After all, the person moving into your home won’t have your dishes, appliances, and furniture. Instead, the appraiser will look for signs of neglect, such as cracked walls, poor paint jobs, broken windows, damaged floors, and other signs that you didn’t take proper care of your property.
More Information about Home Appraisals & Selling in Temecula
Others appraisals myths state that anybody can be an appraiser. Nearly all states in the U.S. require an appraiser to pass a licensing test, to make sure they understand the complex appraisal process. If a “fact” about appraisals seems too ridiculous to be true, then it probably is. If you’d like more information on what to expect from a home appraisal or would like to learn more about selling your home in Temecula, contact us or read our free home seller’s eBook: