Property Appraisals Explained: When to Consider One for Your Home
You may receive real estate brochures in the mail with an offer to appraise your property. You might have thought to yourself, “I’m not selling, so that doesn’t apply to me.” However, getting an appraisal of your property isn’t just for those who think they may be selling soon.
There are several reasons why an appraisal can be beneficial to you. It helps you understand your financial position and the prevailing market conditions.
What is a Property Appraisal?
A property appraisal establishes the current market value if your property were to be sold. It’s based on specific factors regarding your property, such as recent sales in your area, current demand for similar property types, and unique features or advantages that set your home apart.
While many real estate portals and agencies provide virtual estimates, a property appraisal literally means that an agent will visit your home and take a quick tour to understand the accurate value of your property.
How Long Does it Take?
Typically, a property appraisal takes about 20 minutes. An agent will visit your home to inspect its condition, features, attributes, and idiosyncrasies before marrying that information with recent sales data and buyer demand for similar properties in today’s market to provide a price estimate of what could be achieved if listed.
Who Should Appraise Your Property?
If you want your property appraised, it is best to do so through a local real estate agent with experience. These agents work daily within the market, processing property transactions and dealing with buyers. They understand demand and supply, recent sales, and how your property stands in relation to other offerings in the market.
Why Would I Get One?
Many people think about property appraisal services only when they sell their homes. While getting price estimates from agents is indeed an early stage in the selling process, there are other valuable uses for property appraisals.
An appraisal will help you:
- Understand Your Net Worth: The last two years have highlighted the capacity of the property market to turn around rapidly. It’s also highly localised, with wide variations in property values from state to state, let alone suburb to suburb. An up-to-date appraisal of the property will give you an exact idea about the present value of the property and a detailed overview of your total financial status.
- Property Improvement: When an agent appraises your home, it is compared with similar properties in the same market. This provides valuable insights to a seller on possible improvements or changes they could make to maximise the value of their most significant asset.
- Investing: Knowing the real value of your home presently is crucial if you are considering investing in expanding your property portfolio. The appraisal gives you an idea of how much capital you may have available to invest, indicating how much equity you could take from your existing property to purchase another one.