The LA Times published a great article Sunday highlighting some key information about the appraisal industry. We found it to be accurate and helpful information potential buyers or sellers should have a look at as they start the appraisal process. You can read the article in full here: http://www.latimes.com/business/realestate/la-fi-lew-20140824-story.html. But we’ve included some of their key takeaways below.
“There is a major disconnect within the lending business. Some lenders — and real estate agents — think
the appraiser’s job is to get the deal done, whereas appraisers generally think of lenders as money-hungry outfits that don’t understand the apprais
“The appraiser’s valuation is his or her opinion — repeat, opinion — of what the property is worth. It doesn’t matter what the buyer is willing to pay or what the seller is willing to accept.”
“The information available determines much of the results. Appraisers are only as good as the data available to them.”
“You are only as good as yourneighborhood. Like it or not, your neighbors and your neighborhood have an overall effect on your home’s value. In a $200,000 neighborhood, spending $100,000 on improvements is not likely to add $100,000 in value.”
“An appraisal is not a home inspection. The two are totally different. The inspector’s job is to make sure all the mechanical and subsystems are working and that there are no structural issues. The appraiser’s job is to observe the house in its current state, compare that with similar homes in the area and come up with a valuation.”