If there’s one thing that people who are planning to sell their home want to know before the home officially hits the market, it is what price the home will fetch when it is eventually sold. However, any experienced real estate will tell you that setting a price on a property is not necessarily the easiest thing in the world to do.
While homeowners may think that their property is worth a certain amount, they are basing this belief on a lot more than brick and mortar. In fact, many home sellers may add value to their property based on a range of sentimental factors as well. This is easy to understand, as having lived in a specific home in a specific city or suburb for an extended period of time will certainly leave many homeowners with a rose-tinted view of the place they’ve called home for years.
To new buyers, who may not be as familiar with the surroundings and the benefits of living in a particular place, the emotional aspects associated with a home will have very little to do with their interest or disinterest in a property.
For this reason, it is always better to rope in an expert in the realm of real estate. Qualified and experienced real estate agents that have done business in a specific city or suburb for a while will have a good understanding of the state of the local and national property market, in addition to having knowledge of what homes in certain areas are worth at a specific moment in time.
How to prepare your home for appraisal
The home appraisal is part and parcel of the home-selling process, and has the goal of ultimately setting a price for homes that are being put on the market. Not to be confused with the home inspection, which has the purpose of inspecting properties in order to ascertain their safety and condition, the home appraisal aims to determine the market value of the entire property in question, taking into account the home itself, its features and amenities. This is then compared to comparable properties in the same city or suburb.
The home appraisal is typically done by a real estate agent or professional home appraiser. It is often done after the purchase agreement has been signed, and is requested by some homebuyers in order to make sure that the price they are agreeing to pay for the property is in line with what it is actually worth. Some sellers may decide to order a home appraisal before setting a price on the property in order to ensure that they do not have to renegotiate the price of the property with buyers later on.
The real estate agent that is helping sellers put their home on the market will estimate a good selling price by relying heavily on what is called a comparative market analysis, which compares the entire property to similar ones in the same area. For a more accurate estimate, the appraised value of the home (also known as its market value) is calculated by using three different methods, depending on which one the appraiser prefers:
The Sales Comparison Method (also called the market data approach) entails analysing a few comparable properties that have recently been sold in the same vicinity as the property that is being appraised, and using that information to set a price.
The Cost Approach takes into account the cost of land, the cost of building, as well as depreciation (the deterioration of the building, its features, and of the suburb in general). Using these factors in a formula ([cost of land] + [cost of building] – [depreciation]) the value of the property is calculated.
The Income Method is primarily used to appraise commercial or investment property by considering its net income, together with a number of other factors.
Before a real estate agent or home appraiser does the home appraisal, there are certainly things that homeowners can do in preparation and in order to put the home in the best possible light.
Here is how to prepare your home for appraisal.
Get your home clean and tidy
Homeowners should treat the home appraisal just as they would prepare for the open house. This means undertaking a thorough cleaning spree in every part of the home and the rest of the property.
Crack out the vacuum cleaner and feather duster, and try to get into all the nooks and crannies that you usually don’t pay attention to. Shine the floors and taps, and make sure the carpets have been properly washed to get rid of old stains and musty smells.
Don’t forget to pay attention to the rest of the yard – hose down the driveway and clear the garden of any old leaves and garden rubble. Make sure to wash all the inside and outside walls to make a good impression on the property appraiser who is handling the appraisal.
Make sure everything is in working order
Whether it’s for the home appraiser or for prospective buyers, you want to create the impression that the home is properly maintained, which is why everything in and around the house should work as it is supposed to work.
If there are any fixtures, switches or knobs that need to be pressed just so in order for them to work, replace them. Check all the light bulbs, and replace the ones that aren’t working. Minor repairs like these go a long way in ensuring home appraisers that the entire property is in good working order.
Provide easy access for inspection
The home appraiser or real estate agent that is doing the home appraisal will appreciate it if you have made it easy for them to gain access and inspect the entire property. You can do this by keeping entrances clear and ensuring that no doors in the home are locked or difficult to get into. Switch on the lights so they don’t have to touch too many switches in the house in light of the COVID-19 pandemic, and the entire process can be completed swiftly and without any hassle.
Provide complete information
If you have undertaken any renovations or expansions to the property during the time you were occupying it, make sure to disclose all of these to the agent or appraiser that is doing the appraisal. If you have invoices or other records for said work, also have them ready to hand over. Because these prove that renovations have been done by registered tradesmen, it can add immediate value to the property, and will also put potential buyers’ minds at ease.
While you are free to keep certain information to yourself, you should take heed that home inspectors and subsequent appraisals will quickly pick up on any shoddy repair work or untruths in your disclosures. It always pays to be honest, and your real estate agent will likely advise that you repair or renovate the aspects that will put off prospective buyers anyway.
Anyone that has ever sold a home will attest to the fact that selling can be extremely stressful. This is exactly why preparing for the home appraisal in advance is important. If the home appraisal is done before the home actually goes onto the market, it takes care of a lot of the nitty-gritty aspects associated with the sale of a property before the fact.
The home appraisal will give you a good idea of what kinds of repairs and renovations will add genuine value to the home, while also indicating what selling price you can expect when the home is ultimately purchased.
Once repairs have been completed and a realistic selling price for the home has been estimated, all you need to do is to wait for your real estate agent to bring potential buyers to see the home in person.
The home appraisal process isn’t something that should scare home sellers. This part of the selling journey helps buyers to get a good idea of exactly what the real market value of their property is, while also highlighting those aspects of the property that may detract from its value.
Getting the home clean and tidy, making sure that everything works, ensuring that the appraiser has easy access to all parts of the property, and providing accurate and true information about renovations to the property make it easy for real estate agents and home appraisers to quickly put an estimated value on the home that you are selling.
Once you have this information at the ready, all you need is the assistance of a qualified and experienced real estate agent to help you with the rest of the selling process.
Are you still looking for a good agent to help you sell your property? Perfect Agent has a database of thousands of agents across Australia that can help you sell today! Contact us for personalised recommendations and to ensure a quick sale at the right price.