For those looking to finance their new home construction, they will find that lenders can assess the value of your property through an appraisal or a valuation. While the valuation is a calculated figure of your home’s worth depending on construction costs, land value and more, the appraisal is merely an estimate based on some comparable sales that the selling agent is aware of.
Your Investment Property Mag estimates that nine times out of ten, the appraisal price is not an indication of real value. This is mainly because the real estate appraisal is not a thorough home inspection, but a general evaluation of the size, number of rooms, and major updates, and a comparison of the surrounding properties and their value.
A reputable appraiser with long Central Florida background, Sunbelt Appraisals, for example, explained in their blog in 2012 how home appraisal complaints were especially on the rise during a transition market after the housing market had crashed because agents kept comparing “regular” homes to more distressed ones. There are some red flags you can look out for during your home appraisal including a value that is not supportable by market data, misrepresentation of the physical characteristics of the subject property, improvements, or comparable sales, failure to use comparable sales that are the most locationally and physically similar to the subject property, and even conclusions made based on factors such as sex, race, color, religion, handicap, national origin, familial status, or any other type of discrimination.
If you are looking for an appraiser in the Central Florida area, Sunbelt Appraisals suggests taking into consideration important qualifications such as education and training, experience, area knowledge, and references and reviews. Get in touch with us to discuss more options and proceedings regarding your home appraisal and lending, or to have any other questions regarding your new home buying or construction answered.