Last week we went over the basics of home appraisals in our series on determining a home's worth. This week we want to talk about how to prepare for one. Every appraisal will have an inspection, market comparables and the final report. The first part will involve the inspector physically coming to your home. Here's what you need to do to be ready:
Make the appraisers visit a pleasant one
If you have pets, be sure to lock them up. If it's cold outside, make sure the home is cozy and warm and vice-versa if it's hot outside, make sure your home is pleasantly cool.
Research other homes in the neighborhood
What are the values of other homes in your area? What have other homes sold for in recent months? Your real estate agent can help you determine the perceived value and give you information on other sold homes.
Know what will add value
If you're planning on renovating, start with the ones that will add the most value. Kitchens and curb appeal are essential. Know what the return on your investment is for any major renovations.
Keep record of any renovations you've completed since moving into the home. This is a good idea regardless, so you can highlight any improvements you've made to the property.
Clean, clean, clean
Inside and out. The appearance is important. Get rid of clutter, trim the trees, mow the lawn do whatever is necessary to make the home in tip-top shape and "show-ready".
Check lights & safety equipment
Make sure lights both inside and outside the house are working and are in good shape. Replace any burnt out light bulbs and any broken light fixtures. Make sure to have smoke detectors, carbon monoxide alarms, security alarms all installed and in working order.
Double Check the Basics
Fix peeling paint, cracked bricks, damaged gutters and siding. Replace or repair torn screens, non-working doorknobs and latches, worn-out carpet and damaged plumbing and light fixtures. Make sure all your appliances are in working order.
Mind the $500 Rule
Appraisers often measure home values in $500 increments. If your home needs some relatively minor repairs, they could hurt your appraisal. As a general rule, it is safe to assume that small issues will take $500 hits in the total home value. If the appraiser finds several of these problem issues, the result can be thousands in lost home value. As a rule of thumb, fix problems immediately that would cost less than $500 to fix. This way you will recover that cost in your appraisal.
Boast the Neighborhood
Part of the appraisal will be based on similar homes in your area, as well as the neighborhood. Make sure to note any new developments such as parks or restaurants that makes your neighborhood a better one.
Have your own suggestions for home appraisal prep? Share them with us below!