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The buyer typically arranges and pays for the appraisal, but only after the accepted and negotiated offer.
When a seller put their home up for sale, prospective buyers (and the lenders who hold or insure their mortgages) expect that your home is worth your asking price. An appraisal for less than the asking price can complicate, or perhaps block, the sale.
How is Value Established?
The value of a house is based upon recent sales of the similar neighboring homes in the market as well as rentals and listing data.
Ideally, appraisers want to use sales of properties of the same size, age, room count, condition and with similar amenities and external influences. This rarely happens though, so adjustments have to be made, based on what people will pay extra for.
Example: Extra square footage, bedrooms, fireplace, upgrading, parking facilities, swimming pool, lot size, location and so on. To help get a better picture, this information is entered on a form, a value for differences is established and comparisons are made to the subject property. A minimum of three verified closed sales with photos are required to establish a value.
Houses Appraise For More When?
1. Well maintained inside and out
2. Located in a good school district
3. Additions are done with the proper building permits
4. Additions conform with and fit well into the existing house
5. Properties throughout the neighborhood are will maintained
6. Not over improved or the largest house on the block
7. Style of the house conforms to those in the neighborhood
8. Zoning changes are not expected or there is not a mixed use
1. Located on a feeder street
2. Under an airport flight path
3. In or near a gang territory
4. Center of night life activities
5. In a rundown block or neighborhood
6. Next to a school or school yard playground
7. Next to apartments or commercial property
8. In close proximity to a freeway, expressway or railroad
9. Next to a gas station, near municipal garbage or toxic waste dump
10. Orders from factories, farms and processing plants are routinely noticed
11. The city is affected by the closing of a major employer, this can change everything about a house
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