Whether you are buying, selling, refinancing, settling an estate, or simply trying to understand your property’s current value, a home appraisal can provide valuable insight. However, many homeowners are unfamiliar with what an appraisal involves, what an appraiser looks for, and how the final value is determined.

At Michigan Home Appraisal, we believe homeowners should understand the appraisal process before an appraiser arrives at their door. Below are answers to some of the most frequently asked questions about home appraisals.

What Is a Home Appraisal?

A home appraisal is a professional, independent opinion of a property’s market value. A licensed appraiser evaluates the property and considers factors such as its location, size, condition, features, improvements, and recent sales of comparable properties.

The goal is to determine what the property would reasonably sell for in the current market under typical conditions.

Why Do I Need a Home Appraisal?

There are many reasons a homeowner or buyer may need an appraisal. Some of the most common include:

• Buying or selling a home
• Refinancing an existing mortgage
• Obtaining a home equity loan
• Removing certain mortgage requirements
• Establishing a value for an estate
• Divorce and equitable property division
• Tax or financial planning
• Determining the value of an investment property
• Establishing a value for insurance or other purposes

The specific purpose of the appraisal can affect the type of appraisal that is performed and how the report is prepared.

How Does an Appraiser Determine the Value of My Home?

An appraiser doesn’t determine value simply by looking at the home’s size or asking price. Instead, they analyze multiple factors that contribute to market value.

These may include the property’s:

• Location
• Lot size
• Gross living area
• Number of bedrooms and bathrooms
• Overall condition
• Quality of construction
• Age and design
• Garage and other amenities
• Recent renovations and improvements
• Functional layout
• Site characteristics
• Market conditions

The appraiser will also research comparable properties, commonly called “comps,” that have recently sold in the area. These sales provide important market evidence that helps the appraiser develop an opinion of value.

Does the Appraiser Inspect Every Part of the House?

During a typical appraisal inspection, the appraiser will observe both the interior and exterior of the property. They generally document the home’s condition, layout, features, and overall characteristics.

The appraiser may look at areas such as the kitchen, bathrooms, bedrooms, living areas, basement, attic when accessible, garage, exterior, roof, foundation, and other readily observable components.

However, a real estate appraisal is not the same thing as a home inspection. An appraiser is primarily concerned with factors that affect market value and does not perform the same comprehensive examination as a licensed home inspector.

How Long Does a Home Appraisal Take?

The on-site portion of an appraisal can vary depending on the size, complexity, and condition of the property. A typical residential appraisal inspection may take anywhere from approximately 30 minutes to several hours.

After the property visit, additional time is needed to research comparable sales, analyze market data, complete calculations, and prepare the appraisal report.

Do I Need to Clean My House Before an Appraisal?

You do not need to make your home spotless for an appraisal. Normal household clutter generally does not have a significant impact on value.

However, it is helpful to make sure the appraiser can safely and easily access the areas of the property that need to be observed. If possible, clear blocked areas and make sure rooms, mechanical areas, the garage, basement, and other relevant spaces are accessible.

It can also be helpful to provide information about significant improvements you’ve made to the property.

What Improvements Can Increase My Home’s Value?

Improvements that appeal to buyers and contribute to the property’s overall functionality, quality, and condition can potentially increase market value.

Examples may include:

• Kitchen and bathroom renovations
• Finished living areas
• Additional bathrooms
• Updated flooring
• New or updated HVAC systems
• Significant exterior improvements
• Garage additions
• Updated windows or siding
• Quality landscaping
• Other substantial renovations

However, not every improvement adds value dollar-for-dollar. An appraiser considers the market reaction to improvements rather than simply adding the cost of the renovation to the property’s value.

Will a New Roof Increase My Appraisal?

A new roof can positively affect a property’s condition and marketability, particularly if the previous roof was near the end of its useful life or had significant issues.

However, the value impact depends on the property, the quality of the improvement, local market conditions, and how comparable properties are viewed by buyers.

An appraiser considers the overall contribution of the improvement to the property’s market value rather than simply adding the cost of the roof to the appraisal.

Appraisal – FAQ – To be continued…

A home appraisal can seem complicated, but understanding the basics can make the process much easier. From the initial property inspection to researching comparable sales and analyzing market conditions, an appraiser considers numerous factors when developing an opinion of value.

Whether you need an appraisal for a purchase, refinance, estate, divorce, tax planning, or another purpose, choosing an experienced professional is an important part of obtaining a credible and well-supported valuation.

If you need a professional Michigan Home Appraisal, our experienced appraisers are here to help. Contact Michigan Home Appraisal to learn more about our residential appraisal services and how we can assist with your specific valuation needs.

Stay Tuned for our next blog post continuing our discussion on Appraisal FAQs.