Whether you’re interested in buying or selling real estate, an appraisal is a crucial part of the transaction. The appraisal provides an objective view of the home’s value, which allows buyers to gauge whether a home is in their budget. It also informs sellers of any potential issues involving the property, which may need to be rectified to ensure the asking price is satisfactory and fair. 

What Do Appraisers Look For?

To get the most accurate assessment of a home’s value, appraisers must consider many different factors. First, the condition of the home will be considered. Major defects, such as a faulty roof or cracks in the foundation, will drag down the value of the home because these issues require significant repairs. Other factors, such as square footage and the number of rooms, will also be considered, as smaller spaces will yield a lower value, while larger homes will warrant a higher asking price. 

Next, the appraiser will assess the surrounding neighborhood and recent home sales in the area. Even highly impressive real estate will be valued lower if it’s in an area with declining home costs or high rates of crime. 

How Is Value Determined?

Appraisers take all the information accrued during the inspection process and compile it in their final report. Many use Fannie Mae's Uniform Residential Appraisal Report, which is a comprehensive form that covers neighborhood characteristics, descriptions of the home’s interior and exterior, the home’s location, and the condition of the HVAC and electrical systems.

An appraisal also includes photographs of the home, a street map, building sketches, sales data, and other relevant information.

Can a Home’s Appraisal Value Be Improved? 

Making repairs before the appraisal will present your home in a much more positive light. For example, if the roof needs repairs, you can repair or replace the roof to boost the home’s value.

Enhancing curb appeal is also beneficial, particularly if the surrounding neighborhood is experiencing a decrease in home values. Seed the lawn, install a new garden, plant a few trees, or add mulch to garden beds to boost your home’s exterior. After making improvements, be sure to create a list of the repairs or replacements you conducted and their costs, and provide it to the appraiser.