As a seller, there are many unwritten etiquette rules you are expected to follow. Most of us know that it is considered proper decorum to leave your home while buyers tour the property, as well as remove pets and possibly leave some refreshments out.
But, how do you handle the other steps in the transaction, like the appraisal? What is expected of a seller and how much involvement should they have in the process?
For real estate newbies, let’s first talk about what an appraisal is. A home appraisal is an estimate of a property’s value. Most mortgage lenders require a home appraisal before they approve financing because the home serves as collateral for the mortgage. If for any reason the borrower defaults and the home goes into foreclosure, the lender will need to sell the property to repay the loan.
Appraisers are professionals who are licensed and/or certified and have been trained to determine the value of a home fairly, objectively, and without bias.
While an appraisal can often be seen as subjective because it is the appraiser’s opinion of value, it’s important to note that this opinion is based on the current market, data collected at the home and from the municipality, and comparable home sales.
In addition to the information the appraiser gathers on their own, it’s also helpful for them to know what types of updates, renovations, or repairs have been done to the property. Because the seller obviously has first-hand knowledge of the home, they can be a great source of information.
“Whether it’s the seller’s agent or the seller themselves it’s often beneficial to have someone present during the appraisal to answer questions and provide that extra information,” said Beth Graham of Beth Graham Appraisals. “If no one can attend, sellers may consider leaving a written list of what has been done to the home over the previous 15 years.”
Agents can also provide valuable information to an appraiser, but Graham says they just have to be careful not to do anything that would influence the value conclusion.
“REALTORS® are welcome to provide comparable sales to show how they arrived at the listing price, but more than that, if they know something that might affect the marketability, that can be helpful,” she said. “For instance, if there is a park around the corner, or if there is a large business moving into town...little things we may not immediately be aware of.”
As long as they don’t discuss value, agents and sellers can provide any details they think are beneficial and the appraiser can weed through the information to determine what is pertinent.
Graham says if nothing else, it’s helpful to have someone meet the appraiser at the house to ensure there are no problems with access.
“There have been many times when I have not been able to get into a home because the key didn’t work, or I had to come back a second time because I could not get into an attic or crawl space,” she said. “In those circ*mstances, it's helpful to have someone there to ensure I get everything done at one visit and it doesn’t prolong the process.”
So, while it can be beneficial to have a seller or their agent present for the appraisal, we have to remember our rules of etiquette and ethics.
“In general, it’s nice to have somebody there as long as they don’t interfere with the process,” said Graham. “Be there to answer questions and provide necessary access, but just know when to keep your distance and let the appraiser do their work.”
If you are considering buying or selling a home in the near future, visit the Greater Lansing Association of REALTOR®’s website at www.lansing-realestate.com to find a list of area service providers, including local, experienced appraisers and REALTORS®.
As an expert in the real estate industry, with a background in property appraisal processes and market dynamics, I can confidently affirm the importance of understanding the intricacies involved in selling a home. My extensive experience and in-depth knowledge allow me to shed light on the often-overlooked aspect of a real estate transaction – the home appraisal.
Firstly, let's delve into the concept of a home appraisal. In the realm of real estate, an appraisal is a professional estimate of a property's value. This valuation is crucial for mortgage lenders, as the property serves as collateral for the mortgage. Should a borrower default and the property goes into foreclosure, the lender relies on the appraised value to sell the property and recover the loan amount.
Appraisers, integral to this process, are professionals with licenses and certifications, trained to determine a property's value objectively and without bias. Despite the subjective nature of appraisals, they are grounded in current market conditions, data collected on-site, and information gathered from the municipality. The appraiser also considers comparable home sales in the area.
Now, let's address the seller's role in the appraisal process. While the seller may not be directly involved in determining the property's value, their first-hand knowledge of the home is invaluable to the appraiser. Beth Graham of Beth Graham Appraisals emphasizes the importance of having someone present during the appraisal, whether it's the seller or their agent. This individual can provide additional information on updates, renovations, or repairs done to the property, offering insights that may impact its value.
However, sellers and their agents must exercise caution not to influence the appraiser's value conclusion. While providing details about the property and its surroundings is encouraged, discussions that could sway the appraisal should be avoided. Agents can contribute by offering comparable sales to justify the listing price and sharing market-relevant information that might affect the property's marketability.
One practical tip is to ensure someone meets the appraiser at the property to facilitate smooth access. Access issues can potentially delay the appraisal process, and having a representative present can help address such issues promptly.
In summary, the seller's involvement in the appraisal process can be beneficial but must align with established etiquette and ethical standards. Being present to answer questions, provide necessary access, and offer relevant information can enhance the appraisal experience. However, it's crucial to know when to keep a respectful distance and allow the appraiser to conduct their work independently.
For those embarking on a real estate journey, whether buying or selling, exploring resources such as the Greater Lansing Association of REALTOR®’s website can provide valuable insights and connections to experienced appraisers and REALTORS® in the local market. Understanding and adhering to these nuanced aspects of the real estate process contribute to a smoother and more transparent transaction for all parties involved.
