Should I Have My Birmingham AL Home Appraised Prior To The Listing?

This is one of the most popular questions I get when meeting with sellers when they are preparing to put their homes on the market.  The answer is,  it depends.

Appraisals cost between $400 to $700 in our area.  Most of the time your REALTOR'S® market analysis will provide you with much of the same information as an appraisal.

When an agent comes over to talk to you about selling your home, they will most likely, have a market analysis of the current market conditions in your neighborhood and the nearby surrounding areas.   They will compare what homes, similar to yours, listed for and sold for in your area.  An appraiser will potentially use the same information, but will go into more depth about each property.  

So, how do you decide whether or not to have an appraisal done prior to listing your home?

If you live in a typical suburban neighborhood where the homes are similar in style and square footage, you probably don't need to have the home appraised prior to listing your home.  The information on your REALTOR'S® market analysis should be current and give you a very good idea of the market value of your home.  If you are still not sure, maybe you should talk to a couple of different agents and see that they are all in about the same price range, that should give you a good number for your home's value.

My advice to a seller would be that you should have a professional appraisal done prior to listing your home if you have a VERY unique property.  Maybe something that is on the historical register or something that was built exclusively for you by an architect and there is not another similar home in the area.   If you fit into one of these categories, I would strongly suggest pre-appraising your home.

If you do decide to have your home appraised prior to listing, hear me when I say that the appraised value is one person's opinion.  If you hire 3 appraisers, you will probably get 3 different values.   Just because one person's opinion of value is one number, the market value might be a different story.   What someone is willing to pay for the house is the market value and what your home is ultimately worth.  Don't let yourself get hung up on what an appraiser says your home is worth.  If it takes time for your home to sell, other homes may come on the market and go to closing which will affect the value of your home.

The other thing that is important for you, a seller with appraisal in hand,  to know is the appraisal you have is for your own knowledge.   If a purchaser is placing financing on your home, the purchaser and the purchaser's lender will have their own appraisal. 

The bank will most likely use an appraisal from an appraiser that is on the bank's approved appraiser list.   They want to make sure that the buyer is not paying too much and that they are not lending too much money for a property.

Now with all of that said, Appraisals are very controversial these days with all of the new lending laws and guidelines.  We have appraisers come from out of local areas doing appraisals and it is making the sales and loan process difficult.   I think it is important for sellers to understand that the buyer's appraiser, in most cases, is going to be the appraisal that will be used for financing.

Ultimately it is up to you, if it you believe your home needs to be appraised before listing, you can do that.  Just make sure you listen to your professional REALTOR® to tell you how much your home will sell for!!

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