The right appraiser can get you
a better price for your house
house is probably the biggest single investment you've made. When relocating
you'll want to make sure it's appraised properly so you get the best return
on your money. A key factor in that equation is the appraiser.
We talked with Gary Deane of the National
Association of Master Appraisers in San Antonio, Texas, to find out what
to look for when selecting a residential real estate appraiser.
You can look up real estate appraisers in the Yellow Pages, ask
people you know for references or check with any of the half-dozen or so national
associations such as Deane's. But once you've done that, your homework is just
beginning -- you'll need to question the individual appraiser about his education
and level of expertise.
Levels of licensing
"Ask how they're licensed -- state licensed or certified," says Deane. "There's
a uniform national standard but some states have kicked it up a bit. Ask if
they're a member of a national association -- see if they hold a designation
that has to be earned through education."
According to Deane, a licensed appraiser is the beginning level.
"It doesn't mean they're not good, they're in the process of being
moved up to certified. They can't make an appraisal on their own, they have
to have it approved by a certified appraiser."
To become licensed an appraiser must have 2,000 hours of experience,
90 hours of classroom education and pass a state exam. Certification requires
an additional 30 classroom hours, plus an additional 500 hours of experience..
A master senior appraiser has two years' experience, 180 hours in the classroom
and has passed a state exam.
Ask for a resume. Deane says most appraisers will have a brochure,
a marketing tool, to convince you to use them. It would list credentials, training,
areas of specialization, how long they've been in business and which associations
they belong to.
Deane says membership in an association involves more than paying
"They have to meet certain requirements, education, pass exams,
agree to abide by a code of ethics and keep up with changes."
Watch the appraiser
Once you find an appraiser hang around while he's doing the job. Watch what
he's doing and feel free to ask questions.
"They'll be measuring and checking out the structure -- they're
not a home inspector but they need to know the general condition of the house,
septic systems and other environmental issues," says Deane.
Be sure to ask for a copy of the appraisal. Unless you hired the
appraiser yourself you won't automatically get one. If the bank hired the appraiser
then the bank is the client, even though you're paying for the appraisal. By
law you have to be given a copy if you ask for it. Deane says look it over thoroughly;
there have been cases where a whole room has been left off.
A full-fledged appraisal will give you a combination of the "comps"
and the specific condition of your own house. "Comps" are a value comparison
of comparable houses in comparable condition in your neighborhood. The appraiser
will check what the other houses have sold for in the past 12 months. Deane
says most appraisers will use three comps.
The specific condition of your house refers to its age, size,
roof, foundation, whether it has lead paint and other factors.
"Maybe you added a pool or a second floor, that may make your
house overpriced for the neighborhood and the appraiser will value it down,"
says Deane. "The homeowner says 'I put in $20,000 worth of remodeling,' -- you
don't necessarily get that back."
Usually higher value
than tax appraisal
Generally, Deane says, the appraiser will come in with a higher value than the
tax assessor will. For example, in San Antonio, Texas, the tax appraisal is
usually about 85 percent of a private appraisal.
Most appraisals should come within $5,000 of comparable homes
in the neighborhood. If there's a $25,000 difference, something's wrong -- get
Deane says appraising real estate isn't totally scientific, there's
some opinion in it -- what one appraiser sees as a plus another may see as standard.
And, finally, Deane says, most appraisers should spend at least
one or two hours on your property and several more hours in their office arriving
at the value of your home.
"If they're there 15 minutes and then gone, I'd be worried."
-- Updated: April 6, 2005