Halladay Appraisal Services Ltd. has answers to "Frequently Asked Questions"
Describe an appraisal
Describe an appraisal (Go to list of questions)The procedure of performing an appraisal consists of an estimation which forms an opinion of value. This opinion or estimate is figured using a formal method that commonly uses the three main "common approaches to value". One of them is the Cost Approach - which is how much capital would be required to replace the improvements, minus physical deterioration and other factors, then adding the land value. Easily the most common approach in finding the value of a house is the Sales Comparison Approach which concerns making a comparison to similar houses close by. The Sales Comparison Approach is commonly the most definitive and best indicator of value for a residence. The Income Approach is primarily used for finding the market value of income-producing properties based on what an investor would pay based on the amount of income a property produce.
Describe what an appraiser does (Go to list of questions)An appraiser generates an unprejudiced and well substantiated assessment of market value, in the support of real estate exchanges. Appraisers demonstrate their professional findings in appraisal reports.
What are the reasons I would request a real estate appraisal? (Go to list of questions)There are many reasons to purchase an appraisal from Halladay Appraisal Services Ltd. with the most common reason being real estate and mortgage transactions. Some other reasons for getting an report include:
What is the difference between an appraisal and a home inspection? (Go to list of questions)The appraiser is not a home inspector and does not do a full home inspection. A third-party home inspector will evaluate the structure of the property, from the roof to the foundation. The usual property inspector's report will include an evaluation of the condition of the house's heating systems, central air conditioning system (temperature permitting), interior plumbing and electrical systems, the roof, attic, and visible insulation, walls, ceilings, floors, windows and doors, the foundation, basement, and visible structure.
My agent performed a CMA for me. Is that the same as an appraisal? (Go to list of questions)Simply, they have nothing in common. The CMA uses market trends to conduct most of their business. Appraisals use similar sales which are valid resources. In addition, the appraisal checks other factors like condition, neighborhood and construction prices. All a CMA does is generate a "ball park figure." Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.
But the largest differentiator is who's doing the report. A CMA is created by a real estate agent who may or may not be trained in technical valuation concepts or even have a handle on market trends. The appraisal is produce by a licensed, certified professional who makes a living out of valuing properties. Moreover, the appraiser is an unbiased party, with no vested interest in the value of a home, unlike the agent, who gets a commission based upon the price of the home.
What's in an appraisal report? (Go to list of questions)The main point of an appraisal report is to provide a value opinion, and depending on the scope of the report, one will customarily see the following:
Once the report has been delivered, how can I have certainty that the final number is veritable? (Go to list of questions)In communicating an appraisal report, each appraiser must ensure the following:
Who hires an appraiser? (Go to list of questions)Mortgage lenders are an appraiser's typical customer, requiring their services to ensure real estate involved in a mortgage transaction is enough to cover a loan balance in the case of default. Appraisers also provide opinions in litigation cases, tax matters and investment decisions.
Where does Halladay Appraisal Services Ltd. get the data used to estimate values in Winnipeg and surrounding areas? (Go to list of questions)Compiling information is one of the primary roles of an appraiser. Data can be classified as either Specific or General. Specific data is gathered from the home itself; Location, condition, amenities, size and other specifics are documented by the appraiser while on site.
General data is received from a numerous places. Local Multiple Listing Services (MLS) have information on recently sold homes that might be used as comparables. Halladay Appraisal Services Ltd. also has access to the Provincial Assessment data which includes sales throughout the province and SABRE, Solds for Appraisers & Brokers of Real Estate. To double-check actual sales prices, we research items in the assessor's office and other public documents that are usually online nowadays.
And last but not least, the appraiser assimilates general data from his or her past experience in doing assignments for other properties in the same market.
How can a qualified appraiser help me? (Go to list of questions)An appraisal is a worthwhile anytime the value of your home is pertinent to some financial decision. When selling your home, an appraisal assists you in setting the most appropriate price. If you're buying, it makes sure you don't overpay. For parties settling an estate or divorce, an appraisal from Halladay Appraisal Services Ltd. is the best documentation to ensure assets are split up evenly. Simply put, a house is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.
Should I do anything in advance of the appraisal inspection (Go to list of questions)The first step in most appraisals is the property inspection. During this process, the appraiser will come to your home and measure it, determine the layout of the rooms inside, confirm all aspects of the home's general condition, and take several photos of your house for inclusion in the report. Inside, pick up any clutter and make sure we can find our way to things like furnaces and water heaters. On the outside, trim any bushes so we can be free to get an accurate measurement of exterior walls.
The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:
Define "Market Value" (Go to list of questions)In real estate appraising, Market Value is commonly defined as:
Who has rights to the appraisal report? (Go to list of questions)In most real estate transactions, the appraisal is ordered by the lender. Even though it's the buyer that eventually pays for the report, the lender is the intended user. The buyer is certainly entitled to a copy of the appraisal - it's usually included with all the other closing documents - but is not entitled to use the report for any other purpose without permission from the lender.
This rule doesn't apply when a home owner hires an appraiser directly. The appraiser must stipulate the intended use and the intended user of the appraisal in the report.
I want to get more for my house. Where should I spend money renovating? (Go to list of questions)A home's location - what city it is in and even what part of that city - is key to this popular question. For example, installing an inline humidifier could be nice in arid regions, but completely useless near the coast!
As a rule, the most value returned from renovating a home comes in the kitchen and bathrooms. But we completed renovations on our homes for various reasons. Click here to find out How to Value Your Renovations. AIC-How-to-Value-Your-Renovations-web.pdf