RJW Appraisal Group, LLC

Your Appraisal Source

Appraisal Information

What is an appraisal?  Simply stated, an appraisal is an opinion of current market value.

What are appraisals needed for?  Whenever an accurate opinion of value is required, most often for lending purposes - either property sales or refinancing of property. Also, appraisals are often required to settle estates, division of property for divorces, and property tax disputes. In addition, property sellers - especially those that choose to sell their property directly (FSBO - for sale by owner) - often wisely get an appraisal to ensure they are selling their property for a price the real estate market will support.

How are appraisals done?  Normally, once the appraiser has accepted an assignment, an appointment will be scheduled with the homeowner or property access provider for the appraiser to come out and inspect the property, inside the dwelling as well as outside. This is an inspection for the appraiser's benefit, to gain a better understanding of the overall condition of the property, and is not a "home inspection" that a buyer may obtain separately, prior to purchasing a home, to insure the home's faults are known.

Next, the appraiser will normally gather information about the property, from local government records, as well as research recent sale transactions in the neighborhood of similar properties.

The appraiser then inspects the house at the scheduled date. This can take anywhere from about 15 minutes to an hour or more, depending on the size and complexity of the property. 

During the next step, the appraiser will review the previously identified recent neighborhood sales to determine which are most comparable to the subject (property being appraised).  An exterior inspection from the street is done on the selected comparables (usually a minimum of 3 comparables).

The final step is usually done in the appraiser's office, where the applicable report is completed, utilizing the data gathered in the previous steps. Most often, the opinion of market value is derived from comparing the subject property to those most comparable recent sales that have occured in the neighborhood. Other methods used to a lessor degree to determine value are the "cost approach" - what a similar property would cost (including land and an estimated level of depreciation representing the subject's current condition) - and the "income approach" - what the property is worth based on it's rental income potential.