The house sold over List price - What do I do about the Appraisal?

The house sold over List price - What do I do about the Appraisal?


This is the most common question that I receive lately.

Here are 3 Tips that are so important to follow in order to get the most accurate result:


#1 -PROVIDE A LIST OF IMPROVEMENTS

A professional Realtor knows how to best write up the description in the multiple listings to get the best offer(s) on the property.

And the Seller Disclosure also provides a ton of valuable information.

However, as appraisers we are looking for specific info that is not always included in the MLS or often forgotten in the Seller Disclosure.

For example - in the appraisal report we have to state when the kitchen and baths were last renovated or updated.

It's also helpful to for the Homeowner to let us know about any recent changes or improvements that they feel add value.

Especially if they have purchased the property within the last 3 years.

The Homeowner (or Seller's agent) should provide the Appraiser with a simple list that indicates:
1- Year of Improvement
2- What was improved?

Example:
2017: Fully gutted and rehabbed entire kitchen
2018: Updated hall bath with new floor and vanity
2019: Converted unfinished basement to finished basement
2020: Installed an inground salt water pool with patio surround


#2 - PROVIDE COMPARABLE SALES

Highlight and write notes about the information you are providing that lets us know Why you think these sales are a good substitute for the property we are appraising.

** Remember, we are not appraising the Sale Price. We are appraising the property. Providing sales simply because they are a higher price is not information that is helpful.

Comparable sales should have the same appeal as the property you are selling.

Think about what the Buyer is interested in - why do they want to buy this property?

Is it because of the school district?

Is it because it is situated on a certain size lot?

Is it because it is new construction?

Is it because there is a bedroom/full bath on the first floor?

Find sales that offer the things that are important to this particular buyer.

Find sales that are similar in square footage of the house.

(The square footage does not include the basement or the garage - those are items that are considered separately in the appraisal process)

If it's a very unusual house and there are no similar recent sales then go back as far as needed in time to find a sale that represents a reasonable substitute.

Keep in mind, the appraiser is also taking a strong look at the site for things such as zoning, busy streets, surrounding properties, flood zones, etc.


#3 - BE PROACTIVE - NOT REACTIVE

Please don't cross your fingers and wait to see what happens....this only prolongs the process and causes frustration for the Buyer and Seller.

Give all of the above info to the appraiser immediately - either emailed as soon as you have set the appointment or hand it directly to the appraiser when you meet them at the house.

It's a good idea to be at the house for the appointment just to answer any questions that may come up and to also explain to the appraiser why you think the sales you have chosen are reasonable substitutes.

With that said - it's really challenging to have a full on conversation with you while we are walking through the house šŸ¤£because there are specific notes and photos that we need to include in the report. So, many appraisers really appreciate it if you wait to talk after they are finished inspecting the property. Personally, I love people and if the homeowner or realtor wants to chat for an hour after I am done my job then I am happy to do it.

Remember, the appraiser is providing an unbiased supported opinion of value based on verified facts. The process and reasoning is not personal and our opinion has nothing to do with the people who are buying or selling or living in the house. It's all about the property being appraised.

If you have any questions at all I am always happy to help answer them.

If you found these tips helpful please feel free to share with a friend that may also find this helpful. Have a beautiful day!



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