Inside the Home Appraisal Process: What Appraisers Check

Answer

When you apply for a mortgage or prepare to sell your property, a home appraisal plays a crucial role in determining your home’s fair market value. An appraisal is conducted by a licensed, impartial professional to help lenders verify that the requested loan amount is appropriate for the property's actual worth.

What to Expect During a Home Appraisal

The appraisal process typically involves several key steps, both on-site and through market research. Here’s what usually happens:

Exterior Inspection

The appraiser begins by evaluating the home’s exterior. This includes assessing curb appeal, the condition of the roof, siding, foundation, driveway, and landscaping. They take note of any visible damage, signs of wear due to age, and recent improvements that could impact the property’s value.

Interior Walkthrough

Next, the appraiser conducts a thorough walkthrough of the home’s interior. They document the total square footage, ceiling heights, and room layout. Special attention is given to significant features such as kitchens, bathrooms, flooring materials, windows, and heating and cooling systems (HVAC). Any upgrades, modernizations, or deferred maintenance items are also recorded.

Comparable Sales Analysis (“Comps”)

To determine an accurate market value, the appraiser reviews recent sales of similar properties in the same neighborhood — typically within the last three to six months. They adjust for differences in property size, lot dimensions, improvements, and overall condition to arrive at a fair comparison.

Local Market Overview

Beyond individual property features, the appraiser factors in current market conditions. This includes trends in supply and demand, average days on the market for comparable homes, and any seasonal or regional influences that may affect property values in the area.

Final Appraisal Report

After completing the site visit — which generally lasts between 30 and 60 minutes — the appraiser compiles a comprehensive report. This document includes photographs, property measurements, a detailed description of the home’s condition, comparable property data, and the final appraised value. The report is typically delivered to the lender within 24 to 72 hours.

What Does a Home Appraisal Cost?

The cost of a home appraisal usually ranges from $300 to $600, depending on your region and the size or complexity of the property. In most cases, the buyer covers this fee upfront. Lenders order the appraisal through an approved panel of appraisers to ensure impartiality.

Important Tips for Buyers and Sellers

• Appraisers work for the lender, not for the buyer or seller, to maintain objectivity and protect the lender’s investment.
• Sellers should provide a list of recent upgrades — such as a new roof, remodeled kitchen, or updated HVAC system — to ensure these improvements are factored into the valuation.
• If the appraisal value comes in below the agreed sale price, buyers and sellers may need to renegotiate the purchase terms or request a reconsideration of value with additional supporting data.
• Buyers should confirm the appraisal scope with their lender beforehand to understand what’s included and how it fits into the overall transaction timeline.
• It’s wise to consult a licensed real estate agent or mortgage professional for guidance on navigating the appraisal process and addressing potential outcomes.