Through the Appraiser's Eyes

Because I got such a positive response to our last blog (What lender’s are looking for in an appraisal.) We thought we would end the year with several more guidelines that lenders look for and appraisers are required to follow.

Appraising 101

What is the highest value you can put on a report?

When doing an appraisal, an appraiser cannot put a value higher that the highest sale and lower than the lowest sale. The price must be bracketed. For example: If a home is selling for $300,000 and the highest comparable sale is $275,000 then that’s the highest price we can go out at. So when doing a comp search for a listing make sure that there are sales in the neighborhood that support what you think the property will sell for.

What do I do if I have no sales?

If you cannot find any comparable sales in subject neighborhood, then you must expand your search. For example: There are no sales within one mile (This is normally considered the neighborhood). You must then extend your search let’s say 1.5 miles, then 2 miles etc. Normally we limit our search up to three miles. However if you have a unique property you might have to go into abutting towns, or even more than three miles.

What if I have a really unique property, a water front for example?

I just had an appraisal were it was practically ocean front with a gross living area of approx. 900sq. ft., in an area were there aren't many sales at all. In this case I had to expand my search with no milage limitation. Instead I had to go to surrounding towns that had similar water front properties. I think my search took me at far as 10 miles away. These are the things you must do when dealing with such a unique property, and there just are not comparable sales in the subjects town.

I hope these guidelines help when determining a value for a new listing.

Remember if you ever need help feel free to call on us at no charge!!!

Call Today: 508-336-2500 or email info@carrollappraisal.net

Check out our blog on our website www.carrollappraisalservices.com

Enter to win a free appraisal