Remodeling and other work on a home changes the age of that home and makes the price higher. Whether it’s the comparable that’s been worked on or the subject, differences in the two will lead to differences in price. These are things the agent will likely know that the appraiser should ask.
Low Price Due to Circumstances
Some sellers are motivated to sell because of “divorce, foreclosure, [or] job changes,” as Tom points out. Of course in these situations the home is often priced lower than its value. Agents can help appraisers know about these things.
Unusual Terms of Sale or Financing
Unusual terms of sale can lead to a higher or lower price than the value of the home. According to Tom Horn, “Examples of this include owner financing with an interest rate different than what normal bank financing may offer, inclusion of personal property in the contract, higher than typical sales concessions, sales from one family member to another, or other types of financing that may be atypical.”
Higher or Lower Pricing Due to Market
If there’s unusually high demand for a home it will be priced higher, while if there’s an unusually low demand for a home it will be priced lower.
Other Attributes of the Property
A real estate agent may know other things about the home that you ought to know, like what features the home has and what kind of a neighborhood it’s in.
Communication is Vital
An article by the National Association of Realtors highlighted the importance of communication between appraisers and real estate agents and made many of the same points: “Buyers, sellers and Realtors® are free to ask appraisers or lenders to consider additional property information, documentation and comparisons. They may discuss the unique conditions of a home and its neighborhood with appraisers.” They also add that, “Once an appraisal has been completed, any communications about errors or offers of additional information must be with the client who ordered the appraisal, generally the lender.” Want Matt Frentheway to speak at your event about how appraisers and agents can work together? Contact us at 801-260-2828 or 435-657-9630 and we’ll work out all the details or click here. Like us on Facebook or follow us on Twitter for more info on home appraisals!