The Appraisal Process When Purchasing a Home

The Appraisal Process When Purchasing a Home

What Does An Appraiser Look For? An appraiser looks for a home’s “fixed qualities” like location, age, construction quality, total square footage, size and type of rooms, and functional layout. They’ll also look at the homes systems, such as HVAC and plumbing, as well as health and safety factors and code compliance.

The appraiser is using background research on the value of similar, neighboring homes, and their visit to the property in order to give a qualified opinion as to the value of the home, which is then given to a lender. Kaitlyn Baco, Sales Associate with ERA Justin Realty, says, “The purpose of the appraiser providing this information to the lender is so the lender can assess whether or not lending the amount requested would be recouped in the event the buyer defaulted on the loan and the property had to be resold.”

Some question how an appraiser’s role is different than a home inspector, and why does a buyer need both opinions? Kaitlyn further explains, “An inspector assesses the condition of the structure and systems of the home and provides their opinion on its current living condition. This is done in order to give the prospective buyer, and possibly the lender, an idea of how much more money they may or may not need to have to put into the house in the future. This could help a real estate agent and all parties evaluating the information determine if the asking price should be negotiated or adjusted.

The Valuation Process

Believe it or not, the valuation process begins before your appraiser even steps foot onto your property. The appraiser will start by getting a feel for the neighborhood and how your house fits in. Some things they consider include the home’s proximity to the highway, noise level, power lines or public access across the property, whether or not the home looks cared for and maintained, and landscaping and topography.

Once inside, the appraiser is not there to consider your choice of paint color, the pattern of your wallpaper or the curtains you have covering the windows. Rather than these easy-to-change cosmetic detail, the appraiser will be looking at the quality of the finish, and materials used. The appraiser will look to see if the walls are dented, pitted, and marked with chipped woodwork. In addition, the appraiser will assess the home’s layout. In the majority of homes, the design is standard and will not impact the value of the property. However, if the floor plan is unusual or the placement of the various rooms is atypical, then the appraiser may take this into account when calculating their value.

Other rooms that could affect the appraisal price include the kitchen and bathroom and attic. In both the kitchen and bathroom, the appraiser will consider the age and type of fixtures and fittings as well as the floors throughout the home. If you have an attic, insulation levels are taken into consideration along with the access to the attic, whether it has been “finished” and whether or not it has heating or cooling. Speaking of heating and cooling; the type of heating of the home will be noted as there is a difference in value between homes with forced air heating, hot water baseboard heating systems and radiators.

All of this information from both onsite and offsite evaluations is compiled in a report and given to lender to determine the appropriate lending amount.

A lot goes into a real estate transaction, including the appraisal process. To help you make sense of it all, it’s imperative to have a professional, like Kaitlyn, walk you through the steps. To reach out to Kaitlyn or any of our real estate professionals, contact us at 201.939.7500 or 201.438.0588.

Selling Your House “As Is”

Whether you own a house that needs repair, an investment property that is out of town, a home you inherited, or just don’t have the time or money to make the needed repairs, you may be asking if you can sell it “as is”.   Selling “as is” can make it easier for you to sell your home quickly and avoid the hassle of expensive repairs, but it does have some drawbacks.

Cathy Vick, seasoned Sales Associate with ERA Justin Realty shares her thoughts of selling a home in “as is” condition. She states, “When a home is being sold “as-is”, it means the homeowner is selling the home in its current condition with no intention of making repairs or improvements before the sale”. This can potentially save the seller time, effort, and money. Cathy continues, “If you have inherited the home, chances are you have very little idea what may be wrong with the house.  You probably don’t know what repairs it actually needs.  Selling ‘as is’ frees you from the worry of problems potential buyers may ask you to repair.” There are a few things you need to keep in mind when getting this type of home ready for the market.

Realistic Pricing

Once you have a realistic sense of how much repairs will cost, you can start to focus on pricing. A seasoned Realtor, such as Cathy, can give you a good idea of what the fair market value of your home is if it were in good shape. By using this number in conjunction with the cost of repairs you will be able to come up with a listing price that is attractive to both regular home buyers as well as investors.

Fill Out a Seller’s Disclosure 

Selling a home in as-is condition because of repair costs, however, does not relieve the seller of their responsibility to disclose any important information about the condition of the home. Any problems the seller knows about needs to be disclosed and failing to do so could cause serious problems later down the road. A real estate agent will work with you on a seller’s disclosure document to outline any problems that exists with the home. This includes everything from previous water damage to foundation issues or boundary issues. In addition, any issues with hazardous materials like Lead-Based Paint and Asbestos need to be disclosed. If the buyer feels the seller was hiding material facts about the condition of the property, they could sue for damages. 

Negotiation

Selling “as-is” does not mean the buyer can’t re-negotiate the price and as long as there is an inspection clause in the contract, the buyer can get out if the repairs are too costly. The buyer has three options after the inspection: 1) Close at the agreed-upon price; 2) Cancel the contract; or 3) Re-negotiate with the seller for a lower price. The as-is seller can hold their ground and refuse to renegotiate the price or terms of the sale but this whole process can take weeks. 

It can be difficult selling a home that needs significant repairs. Your best bet is to hire an experienced real estate professional, like Cathy Vick, to navigate you through this process. To reach Cathy, or any of our experienced Sales Associates, call (201) 939-7500.

Krista Ponti Joins The ERA Justin Realty Family of Real Estate Professionals

 

Krista Ponti Joins The ERA Justin Realty Family of Real Estate Professionals

 

 

ERA Justin Realty is pleased to announce that our exceptional community of agents continues to grow. 

 

“We are proud to welcome Krista Ponti to the ERA Justin Realty Sales Associate family”, states Jennifer Darby Metzger, Broker Owner at ERA Justin Realty.Krista grew up in Lakewood, New Jersey and is currently a Rutherford resident. Spending half her life in Ocean County and half in Northern New Jersey, Krista is familiar with various areas of New Jersey.

 

As a licensed New Jersey Realtor, Krista is committed to being honest and loyal to her clients as she provides guidance throughout their exciting property endeavors.  She looks forward to offering the people of Rutherford, as well as surrounding areas, professional support in the various phases of purchasing, listing, and renting property.  

 

Krista is a Montclair State University graduate and was a New Jersey Public School teacher for fourteen years.  She has focused on combining her experience in education, passion for people and community, and altruistic personality into her growing real estate practice.  

 

When asked why she chose ERA Justin Realty as her brokerage, Krista says, “I feel real estate is in my blood. My grandfather, Anthony Folio, was an agent with ERA Justin many years ago, when the office was located on the corner of Union Avenue. Once I decided to make real estate a full-time commitment, I chose to partner up with ERA Justin Realty because of their broad industry knowledge, longevity and stellar reputation, and the genuine concern displayed for both clients and fellow agents.  In addition, ERA Justin provides education opportunities to ensure their real estate professionals are handed the cutting-edge tools necessary to succeed in their careers. I am very excited to work among such professionals.”

 

On a personal note, Krista has many hobbies.  She enjoys spending time with family and friends, playing all kinds of sports, going on long hikes, paddle boarding, water skiing, and practicing various Latin dance genres.

 

To meet with Krista or any of our experienced real estate professionals to help you with your real estate needs, call 201.939.7500.