Questions about appraisals

That's a great question. You can get on line for a list of Appraisers in your area or ask for a referral from your real estate agent. She will normally have a list of them. An appraisal runs around $350, so you won't have an appraisal until you have a contract that has been accepted and you have had your inspections done.

It appears that zillow, cyberhomes, eappraisel, and other home evaluation web sites are off on their estimates for our local market. I'm not sure why. If that's our first and easiest tool to use to determine if we should pursue a home and it's way off, then we could either be missing deals or getting ourselves over our heads financially. Would it be possible to ask an appraiser for an unofficial ballpark estimate on a home to see if its even worth pursuing? I would think that local appraisers would be very familiar with neighborhoods and be able to rip off a number that may be closer than the internet tools. Any thoughts?

Tried it, doesn't work. They consider thhmselves experts (some might well be), and this is an afront to their professionalism. If they give you a ball park number it's like you've just taken $350 off their table. They'll probably com eback with some sort of 'need to see the inside, foundation, kitchen etc' answer. Yes, they probably could give you an answer, but they're best advised not to help you.

You can probably get this information off a decent Real Estate agent. Tell them you are thinking of selling (might be true) and was wondering what your place might sell for. If they know the area, they should be able to give you a ballpark price. If not, find you a list of recent sales in the area to compare.

That's one of the ways an appraiser arrives at his/her estimated value. The truth of the matter in all real estate sales is that the house price is the value a buyer is willing to pay. Sometimes this might be $50K above an appraisal or what an agent to might value your place (it happened to me), and some times quite a bit the other way. Trick is to buy the latter and sell the former.

My experience in my market is that appraisers tend to be out to lunch when appraising income properties. For instance I have two older homes that I know I could sell for $300K (for both), yet my appraisals would probably come back at $220K My rental income is $2300 from all units. The income alone demands a higher sale price than any appraiser would provide.

My suggestion is get good at pulling comps, figuring sales prices per square foot and calculating values yourself. That process is exactly what a licensed appraiser does. Most investors work a few neighborhoods, they need to be more knowledgable about properties and prices in those areas than an appraiser. Get comps, build your own database of sales information, talk with sellers who may have done private sales. Remember, only properties sold through licensed agents are on the MLS and thus come up as comparable sales. The more you know about your market, the better your decisions will be.

Your county's property assessor's website would be another good resource to find comparables. Working with a Realtor they can tell you what the other comparables sold for. They'll often times have the information before the property assessor's website is updated with the information. Zillow and the other sites, give you a range of current market values for the property. Always beware of any foreclosures in the neighborhood. When they sell they set the new values for other similar homes in the neighborhood and nearby.

One of your best sources for appraisers will be your local realtors. An experienced realtor will know which appraiser to use for a low evaluation, for an accurate evaluation or for a high evaluation. Yes it is sad to say that this happens.