Do I Need to Get My House Appraised Before Selling It?
As a seller, a home appraisal is not required, nor is it even recommended. Unless you have a unique circumstance, or a house so extraordinary that it renders a standard market analysis useless, a seller’s appraisal is not necessary. An appraisal may initially seem like a good idea to ensure your listing price is accurate, but it is ultimately a waste of time and money. Appraisals do not guarantee value, nor do they provide an accurate estimate of value. Professional standards for appraisers differ greatly across the country; some states do not even require an appraiser to obtain a license. Since no two appraisers are created equally, there can be major discrepancies regarding home value.
To err is human. Professional appraisers make mistakes; from not knowing a neighborhood well, to comparing a dissimilar home’s value to your home. When appraisers estimate the market value, they do so based around comparable homes in similar conditions that have recently sold in the neighborhood. In theory, this sounds like an efficient and reasonable practice, but there are some issues with this logic. Appraisers are not always privy to the all the required (and updated) information. They might receive incomplete information from a real estate agent, and may not ask thorough enough questions to gather the necessary data. Sometimes, after a realtor closes on a house, the home’s pictures get removed from the MLS (multiple listing service) website. If the appraiser is not able to view a home’s interior, the appraiser could accidentally use outdated and inaccurate information as a comparable sale to a renovated house.
A seller’s listing agent will be able to create a comparative market analysis to help establish a home’s asking price. The asking price is based around the amount a buyer is likely to pay for the property, and the amount the buyer’s lender will appraise. A buyer’s lender will not accept a seller’s appraisal, and will still require a buyer to pay for their own appraisal (in some cases, the lender requires an additional appraisal before closing).
A seller’s listing agent will be able to gather the pertinent data to establish a fair asking price. Hiring a professional appraiser does not guarantee a home’s value, nor does it guarantee an accurate estimate. A seller does not need to waste the time and money for a professional appraisal.