A de-cluttered yard could go a long way
Location, location, location. These are magic words when it comes to real estate. While living in a good neighbourhood can add value to your home, there are other factors you will want to consider. Here is what you need to know when getting a home appraisal.
Difference of home appraisal to home valuations
A home appraisal conducted by a real estate agent differs from home valuations typically included in mortgage applications. A home appraisal is an estimate of how much your home could sell for either privately or at an auction. A home valuation, on the other hand, is an assessment of whether a mortgage could be secured using the value of the home.
When making their assessments, valuers and real estate agents take different factors into account. A real estate agent’s appraisal considers less concrete factors like the home’s appeal to potential buyers. A valuer, by contrast, usually sticks more closely to the facts, such as the property size, recent sales in the neighbourhood, and number of bedrooms.
Factors that will impact home appraisal
There are many factors that could have an impact on your home appraisal. Before a mortgage appraiser evaluates your home, here are some things to consider:
Location. One of the bigger influences on the value of your property is the location. A property that is located in a quiet, safe part of town and within a good school district will earn a higher appraisal value than a similar home in a noisy or unsafe neighbourhood.
Size. Larger homes with more land are more valuable than homes that are similar but smaller. Larger properties offer a greater scope for renovations or to develop the property further, as well as offering more living space.
Usable spaces. A property that has more usable spaces such as bathrooms, bedrooms, and car spaces will offer more value to tenants or owners.
Age and condition. Older houses that have stood the test of time have a higher value, even if they are more likely to need more maintenance. While newer homes are more likely to be in better condition, their value might not be firmly established.
Presentation. New fixtures and fittings or a fresh coat of paint are just some small updates that can help potential homebuyers see the value of the home. No detail is too small. Decluttering certain spaces and ensuring the windows are clean will help buyers appreciate the home on inspection.
Garden and landscaping. A nice garden and polished home exterior is a simple way to make a good first impression on potential homebuyers, even before entering the home.
Recent sales. The sale prices of similar homes in the neighbourhood can act as a guide to what homebuyers are likely to be happy to pay for your property.
Future potentials. Potential homebuyers appreciate a home’s potential for redevelopment and/or renovation, as well as other home improvements.
Energy efficiency. Because adding energy-efficient features to your house can reduce your power bill by as much as $500 per year, adding green technologies like solar panels could raise the property’s value.
Interest rates. When interest rates are low, it is more likely for a homebuyer to borrow the funds to buy your home, which, in turn, could increase the average home price in certain areas.
Factors that can hurt home appraisal
Lack of curb appeal. When first arriving at your home, a potential homebuyer will first see the property’s curb appeal. Because you will want to make a good first impression, ensure that your yard is decluttered, the grass is cut, and maybe even a fresh coat of paint.
Broken appliances and outdated systems. This refers to plumbing, heating and cooling, and electrical systems. Your home appraisal may be damaged if either of these are outdated or broken.
Market conditions. Your property’s appraisal value will be impacted by the state of the housing market. If you are in a buyers’ market, you will likely get a lower home appraisal based on recent sales in your neighbourhood. If, however, it’s a sellers’ market, you might get a higher home appraisal.
Overall aesthetics. Your appraiser will not judge your home based on your personal aesthetic or décor, but they will judge your use of space and cleanliness. If you keep your home clean and aesthetically pleasing, then you will likely earn a higher home appraisal.