The residential appraiser is taught how to measure a home, examine it for positive and negative features, take photos, study the neighborhood, seek out comparable sales and listings, and create a report that solves a valuation problem. All of these things primarily involve the technical side of the work. But what about the bigger picture of Residential Real Estate Appraisal Philadelphia PA? What appraisers do has a profound effect upon our local markets, communities, and the nation as a whole.
The appraisal report is merely a tool used by various parties to assist in a residential property transaction. Valuations of all real estates are done using similar techniques, regardless of who employs the appraiser or the kind of property. Appraisers work in areas they are familiar with so they should have a working knowledge of any environmental or other concerns that may affect the value of a property.
These reports will note any unique characteristics of the property and of the surrounding area, such as a specific architectural style of a property or a major highway located adjacent to the parcel. They also consider additional factors of a property including the condition of the roof and any renovations successfully completed.
The techniques and figures they use find their way into the market. Accordingly, appraisers must be aware of the influence they have and the responsibilities that come with that. Consider a situation where you are asked to appraise a home listed in the local MLS in which you find through market research is priced well above the market.
As for Income Approach, the appraiser checks the ability for the property to earn an income. For example, the home owner added a carport. Many tenants are willing to pay extra for the use of a carport. Let us say the home owner transform the carport into another room with kitchen and bathroom. The home owner can rent out the new room. The recent addition to the property increases the appraise value.
This approach is based on recent sales prices of comparable properties. Information is collected on recent sales of properties similar to the subject property. The appraiser will search for similar properties; however, comparable properties will not be identical to the subject property, so there will be a valuation adjustment.
The inflated sale can cause a cascade effect. Now every home is overpriced because of one inflated sale. The result is buyers faced with less affordability and/or sellers attempting to sell their homes at asking prices that are not realistic. Buyers, sellers, agents and even lenders and title companies out there can suffer as a result of this. All because you did not do your duty and failed to consider the bigger picture.
The residential real estate appraisal report is a critical report for the homebuyer to understand. It is an important tool in any property transaction, so make sure that you spend the time to clearly read and understand the report. During your examination, please remember - there are often errors in the report that can significantly impact any final valuation. Accordingly, your goal is to uncover any errors before it is too late.
The appraisal report is merely a tool used by various parties to assist in a residential property transaction. Valuations of all real estates are done using similar techniques, regardless of who employs the appraiser or the kind of property. Appraisers work in areas they are familiar with so they should have a working knowledge of any environmental or other concerns that may affect the value of a property.
These reports will note any unique characteristics of the property and of the surrounding area, such as a specific architectural style of a property or a major highway located adjacent to the parcel. They also consider additional factors of a property including the condition of the roof and any renovations successfully completed.
The techniques and figures they use find their way into the market. Accordingly, appraisers must be aware of the influence they have and the responsibilities that come with that. Consider a situation where you are asked to appraise a home listed in the local MLS in which you find through market research is priced well above the market.
As for Income Approach, the appraiser checks the ability for the property to earn an income. For example, the home owner added a carport. Many tenants are willing to pay extra for the use of a carport. Let us say the home owner transform the carport into another room with kitchen and bathroom. The home owner can rent out the new room. The recent addition to the property increases the appraise value.
This approach is based on recent sales prices of comparable properties. Information is collected on recent sales of properties similar to the subject property. The appraiser will search for similar properties; however, comparable properties will not be identical to the subject property, so there will be a valuation adjustment.
The inflated sale can cause a cascade effect. Now every home is overpriced because of one inflated sale. The result is buyers faced with less affordability and/or sellers attempting to sell their homes at asking prices that are not realistic. Buyers, sellers, agents and even lenders and title companies out there can suffer as a result of this. All because you did not do your duty and failed to consider the bigger picture.
The residential real estate appraisal report is a critical report for the homebuyer to understand. It is an important tool in any property transaction, so make sure that you spend the time to clearly read and understand the report. During your examination, please remember - there are often errors in the report that can significantly impact any final valuation. Accordingly, your goal is to uncover any errors before it is too late.
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