Tuesday, January 25, 2011

Get the Best Price for your home. 5 Tips to Prepare for a Home Appraisal

 Get the Best Price for Your Home: (5) Tips to Prepare for a Home Appraisal

With home values down as much as 40% from three years ago, it will be a long road to recovery in the housing market as foreclosures continue to flood the market. The importance of getting an accurate value for your home through an appraisal is essential.  Though it's not encouraging to hear, many homeowners are competing with these distressed properties when trying to sell.

Yet, every home has something special or unique that can help lift the selling price.  Securing the right appraiser is key to establishing a selling price for your home.  This appraiser should have experience in your neighborhood, preferably your street, and have first-hand knowledge of what other properties look like and know variables, such as their appeal and current value.

The appraiser needs to understand the advantages of living in your neighborhood.  In Chicago, one block can make a huge difference in the "feel" and composition of a neighborhood.  So when pulling together data for an appraisal, the appraiser should know which buildings to compare with yours.  The appraiser needs to value not only the sales of other units in similar buildings, but also be aware of the amenities and lifestyle your building offers, particularly when compared with other buildings in your area.

Before you list your home, check with friends and neighbors, or go online to a site with user reviews such as Angie's List (http://www.angieslist.com/) and find a company that is highly regarded and works in your neighborhood.  Then it's up to you to prepare for the appraiser's visit.  The appraiser's focus is to see your residence in the same way a potential buyer will see it and quantify that experience in the form of an estimate of market value.

Former banking professional and veteran appraiser Michael Hobbs, President of Pahroo Appraisal & Consultancy (http://www.pahroo.com/), has the following tips to prepare a home for an appraiser's visit in advance of selling your home:

1.)    Gather your documents on the financial history of your building/home, create a list of amenities, investment capital into the building and/or your individual unit, including remodeling/updates, parking availability, management company and neighborhood association (if applicable).  One place online for condo owners to resource while gathering such information is Chicago Condos Online (http://www.chicagocondosonline.com/).       

2.)    De-clutter and get organized.  While an appraiser and ultimately a buyer are looking at the physical space that will be purchased (and not your personal items), you want to optimize their experience of the residence.  If you wouldn't invite your friends over, much less a potential buyer, then tidy up.  Start with the most cost-effective improvements: de-cluttering your home, throwing away that stack of old junk mail, giving unused items to a local charity or Salvation Army (http://www.salvationarmy.com/), putting your lesser used items in portable storage, such as SmartBox (http://www.smartboxusa.com/), or hiring a professional organizer, such as Laura Olivares (http://www.borganizedinc.com/).

3.)    Light up your home, which is another cost-effective improvement.  Walk through your home and look closely at those individual light bulbs that burned out months ago, and replace them.  Consider higher wattage, more energy efficient bulbs.  By brightening up your home, you change not only the experience of a potential buyer, and therefore the appraiser, but you also change the energy.  Dimly lit rooms seem small and are not necessarily suited to today's buyers.  Bright and open spaces are more appealing to buyers and will sell faster per a recent article by http://www.realtor.com/.

4.)    Clean, clean, clean (inside and outside) your home, another very cost-effective improvement.  Have you ever arrived at a house and had a bad feeling before you even got out of the car?  When was the last time either you or a cleaning company went through and deep-cleaned your home, specifically the kitchen and bathroom which are areas of primary concern to potential buyers?  After curb-appeal and general basic landscaping, these two areas account for the primary attention of would-be buyers and should be clean and odor-free.   Remember, first impressions are typically the only opportunity you have to show off your home.

5.)    Repair broken items.  Before you consider overhauling your home for that would-be buyer, make those minor cosmetic repairs that you've been putting off for months or years.  A well-maintained house not only shows well and indicates move-in ready condition, but also sends a message to a buyer that if what they see is cared for, then likely what they can't see has probably been taken care of as well.  Whether you're a do-it-yourself (DIY) repair person, or you hire a local trusted handyman such as Dad's Handyman Service (www.calldads.com), make those quick fixes to maximize the appeal of your home.  If you are considering bigger investments, check out the recent cost vs. value analysis at (http://www.remodeling.hw.net/).

In summary, there are many features of your home that you cannot change, such as: the size of your home, the location/neighborhood, the total number of bedrooms and bathrooms, and recent sales activity of your neighbors.  Yet for all of these variables you cannot change, by performing the actions above, you can make sure that you have represented your home most favorably not only for the appraiser, but ultimately for that future buyer.

Michael Hobbs is the President of Pahroo Appraisal & Consultancy.  His firm is an Angie's List 2010 Super Service Award Winner, a designation given to less than 5% of all firms.  Michael is also an Appraisal Institute associate member.  Contact him at (773) 388-0003.  His e-mail address is Hobbs@PahRoo.com.
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