Although the valley continues to see a
consistent increase in home value of approximately 4.6 % , we are also
experiencing a gap between what agents have deem to be the fair market value
and what the appraiser are valuing homes at.
Staying ahead of the game and being informed can save you not only money
but time and heartache. By choosing wisely
a Loan Officer and Real Estate agent that possesses the tools and knowledge to
strategically protect your greatest asset!!...YOUR HOME
Not all agents and lenders are
created equally
-
An experienced and knowledgeable agent has
received proper training and should know how to value a home based on the current
standards of an appraiser, such as what is considered a comparable, how far out
a comparable can be, the age of a comparable and the dollar value of an
adjustment. Often inexperienced agents
will choose a comparable that an Appraiser would never consider, bypassing a
true comparison for obvious reasons.
-
When choosing a lender you want to choose a
lender that not only is well versed in the current market values, also what is
the lender's relationship with the appraisal company chosen? What are the criteria for the appraiser to be
deem qualified and competent in valuing your home? Ideally you want a lender who uses an
Appraisal Management Company. If your
lender does not have this relationship established, you will get a crapshoot
as to who is appraising your home and their qualifications.
What you paid yesterday is not
what it is worth today.
-
Often
homeowners decide to do a massive renovation right down to the door knobs of a
home, with an anticipation of increasing the value of their home. YES, this is true; improving your home gives
you the competitive edge and provides the aesthetics that buyers seek today. What homeowners must keep in mind is certain
improvements are more valuable than others, and an appraiser will never give
you full dollar value on what you invested in the home. For instance, the 80K pool improvement that
you absolutely love will at most receive a 10K positive price adjustment
opposed to your neighbor who has a faux putting green. When listing your home your trust in a
qualified agent’s valuation, not
allowing your judgement to be clouded by a desired purchase price that the
market will not support.
Industry Standards
Have Changed
-
The
Consumer Financial Protection Bureau and revision to the Truth in Lending Act
set new parameters and criteria as to how an appraiser values a home. In the event the appraiser over values and a
home to support a sales price and a trend occurs the appraiser can find
themselves under investigation. There is
an additional push by appraiser to not make consistent revisions to an
appraisal. Playing it safe is more of a
practice than ever. To get a revision is
like pulling teeth and costly. To protect
yourself, have a qualified Appraiser who is familiar with your area and type of
home is key. A good Real Estate agent is
also very strategic in partnering with the appraiser, not in steering the value
but being an expert and additional point of reference to ensure there are no
errors in the valuation.
