The Appraisal & Process

The Residential Real Estate Appraisal

A tenable estimate or measure of value of the rights of ownership

The Appraisal Process

The appraisal process involves obtaining an estimate of value. This involves, in part, the following: defining the problem, preliminary research of the subject property, inspection of the subject property, data collection and analysis, consideration of three approaches to value, when applicable, that include direct sales comparison, cost, and income approaches, reconciliation of value, and a final estimate of the defined value.

The inspection of the subject property will take approximately ½ hour, or more, depending upon the property. The entire process of data collection, inspection of comparable sales, verification of sales with various sources, and public records, and completing the report comprises the majority of the process.

The appraiser will contact client or occupant to set a date and time to inspect the subject property. There will be an interior and exterior inspection of the improvements and site, photographs of the front and rear of the dwelling as well as a street scene. Measurements will be taken of the exterior of the dwelling and an interior floor plan when required.

Typical Residential Appraisal Report Addendums & Attachments

· Cover page
· FIRREA Compliance Addendum
· Building Sketch
· Location Survey (if available)
· Flood Map (if applicable)
· Location Map
· Pictures of Subject & Comparables
· USPAP Compliance Addendum
· Appraiser’s Certification (6/93)
· Statement of Limiting Conditions (6/93)

Useful information and documents furnished appraiser (not required)

· List of recent updates and/or improvements
· Copy of deed/location survey or site plan/blueprints or floor plan – builder’s brochure
· New Construction – plans / location survey or site plan / cost estimates or proposal of same
· List of upgrades and additional features that may not be salient during inspection
· Current real estate taxes / special assessments / ground rents / homeowner association or condo fees
· Community amenities or recreation facilities (if applicable)
· Income property: Leases / income & expenses
· Contract of sale if applicable

Partial List of Reasons for an Appraisal

· Primary or Secondary Mortgage
· Refinancing of Existing Mortgage
· Removal of Private Mortgage Insurance
· Divorce Settlements
· Eminent Domain
· Estate Planning
· Employee Relocation