Hampton Roads Area, Virginia Home Appraisals

Buying a Hampton Roads Area home covers a lot of ground, including legal, financial and emotional considerations. A lack of education in the home buying process and the mistakes of others may lead to disaster.


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Hampton Roads Area Home Appraisals...What they are...

An appraisal is an un-biased, third-party estimate of the value of a property. Each appraisal must be consistent with rules set forth by the Federal Reserve, however eventually each appraisal is a personal analysis of a property's existing market value. Proper market value can be difficult to ascertain in districts where prices are unstable and properties widely vary.

The property appraiser utilizes market-based tools to develop an estimation of worth. This generally means market value (or the sum of money that a person would pay for it). There is always some discrepancy and every potential buyer or seller and real estate industry professional conveys a unique series of notions to the table. There are many considerations and tools that appraisers can use to determine the market value of a property.

Appraisers and other industry professionals

Sellers and homeowners hoping to refinance want to get the highest price they can for their real estate. Buyers may have an open allegiance to an agreed price because of their wish to purchase the property. Brokers and loan originators are paid commissions based on the value of the sale or loan. An appraiser, on the contrary is paid a uniform fee, whether the deal is attained or not. Theoretically, he/she is open to provide an informed view of the value of the property.

What type of Hampton Roads Area real estate can be appraised?

Most commonly, appraisers will be asked to offer an analysis of an existing home or property. The appraiser can also estimate the value of a home that is presently being developed. The finished home is appraised using only the builder's plans and information that contains the site characteristics.

Commercial real estate can be appraised by a assortment of methods, including cash flows. This can also consist of an evaluation of predicted income and expenses to use as measurements of the net current worth of a commercial property.

Tools used by Hampton Roads Area appraisers

There are a number of different tools and measurements that appraisers may use to present an appraisal. Among them are:

Previous real estate sales. In these current times, data has become increasingly available through the Internet with the ability to search for sales throughout the US. There are a wide series of resources that will provide the date, price range, type of property, grantor/grantee, address including access to electronic deeds. Other details on a property can also be found at the assessor's office.

Economic values. The appraiser can retrieve and examine employment and wages for states, including prices for a variety of economic entities such as metals, major currency exchange rates, bond yields, stock averages, LEI, CPI and Core Rates.

Software. A large number of powerful software systems are also obtainable to allow for faster reporting and professional photography, topography and aerial maps.

The Appraisal Report

The appraisal report is a "snapshot" of the property and the neighborhood and generally provides a description of the neighborhood (price ranges, ages of homes, quality of access to schools, shopping and work). This generally will consist of the stability of the local economy and rank its desirability in comparison with neighboring areas. The report will also mainly consist of the site description including its size and shape, zoning compliance and any easements or restrictions, all of which influence the property's utility. The availability of utilities, maintenance of streets are also included in this report. Any enhancements to the property or buildings are illustrated in some detail such as the number of rooms, the quality and condition, the size of the home, and any special features. There usually are pictures and sketches on additional pages. A complete and final valuation will be provided stating which of the methods were used and an explanation as to why each approach was chosen in addition to the importance of the method in determining value. Three methods that are generally used are: Cost (replacement), Sales Comparison (what has been paid for similar properties) and Income (if it is a rental or non-residential property). The appraisal analyzes property rights plus improvements and expresses the total as a dollar value in the current market.

Exact appraisals are to your advantage, not because they have different values than poorly written ones but because they move smoothly through the bank's underwriters. Precise appraisals are reader-friendly, understandable, and clearly show the relationship between local market conditions, the data used, and the definitive value.

Appraisals can be intended for:

Mortgages
The most common use is when a buyer applies for a mortgage to assist with the purchase, or when a homeowner refinances or applies for a home equity loan. The bank studies the application, checks the borrower's credit report, and finally orders an appraisal on the home that is used to secure repayment of the loan.

Divorces
Home value can be of the utmost importance particularly when one spouse intends to keep the home and buy the other's share out. The party receiving cash for giving up ownership will benefit from a high value, while the party retaining the property benefits from a low estimate. Often times, both sides will hire their own appraiser. A skillful appraiser can prepare a report that is more convincing to the court and less vulnerable to skewing from a "biased" report that unfairly favors 1 side at the expense of the other.

Estate Settlement and the Internal Revenue Service
When an appraisal is needed in the case of an estate settlement with the IRS, a lawyer can select the right appraiser and define the appraiser's assignment in a more precise way.

Buyers Offer
An appraiser can advise Buyers of a realistic value for the property on which you can base an offer.

Selecting the right appraiser for you

One important thing to consider when hiring a specialist home appraiser is whether they are knowledgeable in property and home values for the area or region in which the property resides. This is especially important for atypical properties or difficult appraisals.

An additional consideration to make is whether the home appraisal company provides professional service with reasonable appraisal fees and turnaround times. Residential fees can fluctuate greatly depending on the region, property and time estimated to complete the appraisal report. The more complex the house appraisal report, the higher the fees. And finally, does the company doing your house appraisal have the most apt data sources for the area and property type to be appraised?

Determine the length of time the appraisal company has been in business? They should have an established business long enough to have seen the market fluctuations that have provided some experience with market volatility.

Find out how an appraiser will determine likeness among competing neighborhoods. A good appraiser will consist of knowledgeable criteria such as density of development, price range, incomes, or even census tracts.

Question how many appraisals are conducted on a weekly basis by the appraiser. The value here is to determine whether a thoughtful, exhaustive, analytical appraisal will be produced.

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