Real Estate Appraisals in Boise, ID
In real estate, property appraisals are common. An appraisal is very important when buying or selling property as it provides you with a realistic baseline value for the property. It gives you an idea of a fair price for the property you wish to sell or buy. Financial institutions also use appraisals to determine the amount of a loan to extend to those seeking financing to acquire property. Thus, appraisals play a key role in the real estate industry.
The Need for an Appraisal
There are several reasons you may need an appraisal. The most important one is that you need to know the correct value of your home to avoid paying more or selling it for less than its value. From a buyer’s perspective, you do not want to pay for a house and realize later that the price was inflated. Similarly, when selling it, you want to get the best price for it. While you may have bought your property at a given price, some factors may have changed its value over time. For instance, improvements to the house would increase its value. While real estate appreciates at a given rate within a given area, improvements to a property would likely increase its value more than the appreciation rate.
As mentioned, appraisals are also very important when seeking mortgage loans. Financial institutions require appraisals before they can decide on the amount of loan to extend to you. The appraisal minimizes risk for the lenders as they are able to determine how much to lend on the basis of the value of the property. Without an appraisal, they may end up taking up too much risk without knowing.
The Components of an Appraisal
There are four main components to every appraisal. These four components play a big part in the determination of the value of the property under appraisal.
1. The Description of the Property
The description of property defines its size as well as the boundaries. It would include things around or near the property such as streets, rivers and other landmarks. For size, generally speaking, the bigger the property, the greater the value of the property.
2. Market Information
Market information includes factors such as location and the demographics of the neighboring area. proximity to some resources would increase the value of a given property. A property near facilities and amenities such as schools and malls may have a higher relative value.
3. The Best Use for the Property
The intended use of any property has a huge bearing on the valuation. Property intended for residence generally fetch a high market value. The possibility of redevelopment also raises the value of property. Appraisers would therefore use the potential uses of property to determine a fair valuation.
4. The Valuation of the Property
The most important part of an appraisal is the valuation of the property, where the appraiser assigns a value to the property on the basis of their analysis. There are three valuation methods that appraisers can use. The comparable approach uses the prices of comparable properties in close proximity to determine the price of a given property. They will often make adjustments based on the existing differences between the properties.
The cost replace method determines the value of a property based on how much it would cost to rebuild the property. Lastly, the income capitalization method is based on the amount a buyer would be willing to pay for a property and the income the property is likely to generate, in the case of a rental or commercial property.
The Cost of Home Appraisals in Boise
Nationally, it would cost $337 on average for a home appraisal. In general, most appraisals would cost from $312 to $405. However, there are instances where you can pay as little as $250 or as high as $600 for your appraisal. On average, a home appraisal in Boise, Idaho will cost you about $313.10 for a single family home or condo. The cost would normally range from $242.40 to $383.80. The cost normally includes time, material and cleanup costs. However, the costs are specific to given homes and projects depending on area.
There are resources online to help you estimate the appraisal cost for your property. The estimates are dependent on the location and size of your property as different places have different rates. Most appraisers use either an hourly rate or a flat fee. The appraiser would have a flat rate for a given size of property with additional fees for every additional square foot. However, there are few that charge a percentage of the value of the property. This is not ideal as it is unethical.
Your first resource should be your agent. At Real Estate with Tazz for example, we have a carefully vetted list of fair and reputable appraisers to whom we can refer you.
Choosing Your Appraiser
Selecting an appraiser for your property is as important as the appraisal itself. You need an appraiser that will give you value for your money. You do not want an appraiser that will give you inaccurate information as you may end up losing money. A credible appraiser will ensure you have accurate information without the need for a second opinion. Some of the factors to consider when choosing an appraiser include experience, qualification, competency, specialization, references, and their fees.
Experience is an important part of appraisal. Your appraiser needs to have sufficient experience dealing with your type of property. They also need to have experience working with property in your area. That will ensure they know what they need to check.
An appraiser’s qualifications and specialization determine what properties they can handle. Some appraisers may be licensed to handle complex properties while others may only deal with basic properties. The qualifications and specialization will determine if they can handle your property.
References are a good way to gauge an appraiser’s competency and expertise. Through past clients, you will be able to draw some insights into their work. The last factor to consider is the fees charged. You need to get a fair cost for the services where all the other factors are satisfactory.
If you are thinking of selling your home in the near future, we would love a chance to chat with you about your selling needs and to see if we are a good fit for you and your family. To schedule a time to chat please visit our Contact page, or if you would like a complimentary copy of our Listing Implementation Plan - which details how we list and sell our clients’ properties - please click here: Download the Listing Implementation Plan PDF