Whether you are buying or selling a home, refinancing a property, or trying to determine a property’s value for other reasons, you may want the services of a real estate appraiser. Real estate appraisers provide a valuation of a property.
CONSUMER TIP: Comparative Market Analyses (CMA) your real estate licensee might use to assist your decision on a listing price ARE NOT real estate appraisals. CMAs must provide a range of value, not an exact value, and must expressly state they are not an appraisal. Lenders do not use CMAs when determining the value of your property during the mortgage underwriting process. They will use an appraisal prepared by a licensed real estate appraiser.
Why use an appraiser?
Appraisers can be called upon as consultants or valuation specialists to provide opinions on:
- the current value of the property being bought or sold
- future value of the property being built
- value for mortgage or lending purposes
- value to assist in investment decisions
- value of assets
- value of the property involved in a legal dispute
- verification of damage claims
- value to properly measure property tax assessments, capital gains and other taxes
- value of property to determine compensation when the property is expropriated
- consulting—feasibility studies, property management, lease analysis, highest and best use studies
An appraisal may be required for private sales or transactions involving property not listed on a listing database, a high loan-to-value ratio or for non-sales transactions, such as refinancing or renovation loans. Those purchasing a property from a “For Sale By Owner” without a licensed real estate agent may be even more interested in having an appraiser evaluate the property as it may provide greater piece of mind that the price is appropriate.
Appraisers produce appraisal reports based on the specifications of a property and the variables that help determine its market value
Courtesy: RECA
