What Do Interior Field Appraisers Look For In A House From The Outside?

May 20

Appraisers have a tough job, according to Paul Fonseca, a top-selling real estate agent in Fort Myers, Florida. They are in charge of determining the worth of a house in today's ever-changing real estate market.

Residential house appraisers, according to the Appraisal Institute, utilize a systematic appraisal technique to arrive at an estimate of a home's market value. The Uniform Residential Appraisal Express, created by Fannie Mae and Freddie Mac, is used by most appraisers to describe their conclusions (URAR).

With the help of six industry experts, we'll explain what home appraisers look for when appraising your property. Here's a little peek at what's in store:

Appraisers analyze the structural integrity of your house.
Your home's location has a big influence on its value.
Appraisers examine both on-site and surrounding property qualities when determining a property's worth.
These are the criteria used by FHA appraisers.
Appraisals for refinances work in a similar way as appraisals for home sales.
Appraisers do not assess moveable or decorative parts.
Although a low evaluation may be challenged, the value of your home is unlikely to improve.

Appraisers analyze the structural integrity of your house

The general property qualities, such as construction materials and structural components, are evaluated in a standard assessment report. Appraisers employ the sales comparison approach to compare the qualities of the house to those of previously sold comparable properties.

When comparing two similar properties, an appraiser may assign a house with a two-car garage a greater value than a property with a one-car garage.

Appraisers seek for the following features during Baldwin Harbor interior field appraisals:

Characteristics of the property

The dimensions are as follows: In square feet, the number of rooms, bedrooms, and bathrooms in the structure's living area above grade.
Driveway and garage Whether a garage is detached or built-in determines the number of automobiles it can hold and the sort of driveway surface it has.
In addition, there is a residential unit known as: The ADU's zoning status and how it impacts the property's marketability and value.
Overall rating: The overall condition of the property, as well as if it meets neighborhood standards.

The inside is decorated with

The many types of heating and cooling systems and their present condition.
Materials and condition of the floor.
The materials used and the condition of the walls.
Trim and condition the material.
Refrigerators, stoves, ovens, and dishwashers are all examples of appliances.
Energy efficiency certification, tankless water heaters, and insulated ducting are just a few examples of energy-saving features.

Characteristics of the surface

Material and condition of the outside walls.
Roof: The kind, condition, and material of the roof.
Windows: Consider the kind of window, whether it has screens, and the amount of insulation installed.
A pool, an outdoor fireplace, and other outdoor activities are available.

The attic and the foundations

The sort and quality of the foundation are crucial.
Basement: Whether completed or unfinished, the basement is the most important part of the home.
Finished or unfinished attic.

Improvements, renovations, and expansions are also taken into account by home appraisers

"It's self-evident that a newer or more upgraded property would sell for more money than a comparable but older home," says Mason Spurgeon, a trained general appraiser and owner of Spurgeon Appraisals.

The focus is on improving kitchens, bathrooms, and other key components

According to Spurgeon, a recent remodel might boost the value of your home. "Updated kitchens and bathrooms have a major impact on a home's worth since these are the areas where a buyer would spend the most money if changes were required," says the author.

Major components (expensive ones like a new roof or air conditioning system) are particularly important in older houses.

"A lot of the time, an appraiser will come out and look at an air conditioner to see how old it is, or they will check permits when they draw permits," says Fonesca. It's a different story when you tell them it was newly installed and it's a Trane air conditioner that cost $7,000. "And we just got a new roof for this much last year."

Swimming pools and patios on the ground floor may not contribute much to the value of a home

According to John Huston, a professional appraiser in St. Petersburg, Fla., who covers three counties and has evaluated over 3,800 properties since 1999, an in-ground swimming pool adds some value but depreciates in value due to the maintenance required.

A $120,000 in-ground pool isn't necessarily worth more than a $35,000 pool, to put it another way. "You won't get $120,000 if you sell your pool," Fonseca predicted. "Each of you has a fully functional swimming pool." It makes no difference who spends more money."

Extra features, according to Spurgeon, seldom add much value. "Porches, decks, and other outside living spaces have a smaller effect in our market," he says.

Your home's location has a big influence on its value

Spurgeon adds, "Location, location, location," indicating the single most important factor in evaluating a home's value. While appraisers aren't required by Fannie Mae standards to analyze or grade a neighborhood, they do take into account objective facts like the home's location and other attributes that might affect its value and marketability.

The density of the region, the pace of increase, and whether the place is urban, rural, or suburban are all elements to consider.
The neighborhood's attractiveness: All employers, services, and public transit are within walking distance.
The following are the current market conditions: The time it took to sell a house lately, as well as if prices and demand are increasing or decreasing.

Appraisers examine both on-site and surrounding property qualities when determining a property's worth

Appraisers consider the size, shape, and terrain of the property, as well as easements and encroachments. Things like street utilities and vehicle access will be noted by the appraiser. The method of assessment involves determining if the home's features are marketable.

A property's zoning classification decides whether it is suitable for its intended purpose.
Whether there are any distinct threats (such as environmental hazards), and whether the hazard impacts the home's value or marketability are examples of specific hazards.
FEMA's flood zone designation is: The home's location in a FEMA flood zone is a significant consideration.
Improvements made outside of the office Working conditions: Streets, alleys, sidewalks, lights, curbs, and gutters are all important considerations. Any additional site circumstances that might have an impact on the home's marketability or value.

These are the items that FHA appraisers check for

FHA appraisal criteria are harsher than conventional loan appraisals, according to Bethany White, a top Virginia Beach realtor with over 13 years of experience. Appraisers for FHA loans, like those for conventional loans, provide an opinion on the value of a house. Unlike standard loan examiners, FHA assessors also check for health and safety concerns.

While a conventional loan assessor would look at a house's overall condition, the FHA's standards go considerably farther. Some of the FHA appraisal requirements that must be satisfied before closing are as follows:

The appliances that are being sold must be in excellent working condition.
There should be no leaks or damage in the attic insulation. Furthermore, the attic area must be well ventilated.
Water infiltration or standing water in the crawl area must be avoided.
Grading and drainage around the building are required.
The electrical system should be appropriate for the kind of building and in good working order.
The foundation of the house must be strong.
Heating and cooling systems must be in working order.
Chipped and peeling paint should be repaired as quickly as possible, particularly if lead paint is present (with homes built prior to 1978).
The plumbing must be in excellent working order.
The roof's life expectancy must be at least two years.
A termite infestation must be disguised in order for it to be seen in the home.
If the residence does not meet all of the FHA's assessment standards, the homeowner must remedy all concerns before closing. "The appraiser has to go out and sign it," White continued.

Appraisals for refinances work in a similar way as appraisals for home sales

From the appraiser's perspective, whether refinancing or buying, the general valuation process remains the same. An appraiser analyzes the same elements in both types of appraisals when determining a home's value. A comprehensive refinancing appraiser uses the same URAR form as a purchase loan appraiser.

If you're refinancing, your lender will request the assessment you'll need for your loan. A comprehensive investigation may or may not be required by the lender. Under the bank's underwriting standards, a limited appraisal, such as a drive-by or hybrid evaluation, may be required if the appraiser does not visit your home. "It truly depends on who's handling the refinance," White explains. "It might be done differently in your bank."

In the near term, external circumstances may influence whether your lender demands a limited review. Drive-by evaluations were widespread during the pandemic, according to Jolene Jacobs, a top realtor who deals with 80 percent more single family homes than the average Royal Oak agent. Additionally, due to a scarcity of appraisers in the Michigan area a few years ago, extra drive-by assessments were performed to meet demand.