A pivotal moment of real estate transactions, a home appraisal is an unbiased assessment of a home's value. And the appraisal results can have an immense impact on the outcome of the sale; 20% of closing delays are caused by appraisals.
If the appraisal comes in low it's either back to the negotiating table or the sale can fall through entirely.
To help reduce the anxiety and uncertainty surrounding a home appraisal, it's smart to partner with an experienced, top-rated agent who can accurately price your home to avoid a low appraisal.
Get in touch with a licensed expert for a free, no-obligation consultation about pricing your home competitively and how you can make certain the appraisal and sale goes smoothly.
To help guide you throughout the appraisal process, here's everything you need to know about home appraisals in Columbia, SC.
What is a home appraisal?
A home appraisal is an objective determination of what your home is worth. The buyer's lender will hire a third-party, unbiased professional who will conduct an on-site evaluation of your home.
The appraiser factors in your home's age, lot size, square footage, the overall condition of your home, the structural integrity, building materials used, your location and neighborhood desirability, style, curb appeal, any improvements or repairs, the local market, and comparable homes recently sold.
The buyer's lender will not approve a mortgage for more money than what the home appraises for, meaning the buyer will have to pay the difference or negotiate a lower sales price. At worst, the sale could fall through entirely.
When does a home appraisal happen?
Typically, a home appraisal happens after the seller accepts an offer and within a week of the inspection. This means the appraisal comes in after both you and the buyer agree on the sales price, repairs, and any concessions.
However, you can also choose to get a pre-listing appraisal. Getting an appraisal before you put your home on the market, can help you set a competitive and more accurate asking price to ensure the sale goes through without a hitch.
You might also need an appraisal if you decide to refinance your home. Again, lenders require an appraisal to protect their own interests in case you default on your loan and go into foreclosure. Your home's value will have fluctuated between when you first purchased it and when you want to refinance; your lender will want to know your home's current value.
Market Value vs. Appraised Value
Market value and the appraised value are not the same thing. Put simply, market value is what buyers are willing to pay for your home, making it very subjective.
On the other hand, the appraised value is determined by a licensed appraiser who assesses your home's value objectively based on comps, location, your home's condition, home improvements, and other determining factors like the age, size, layout, etc.
Because of the different factors that impact these two values, they can be quite different. For instance, as of October 2019, Columbia homes have a median value, or appraised value, of $138,100. However, the median price of homes actually sold is $143,200. The market value of Columbia homes is higher than the appraised value because buyers are willing to pay more.
Factors Impacting a Home Appraisal in Columbia, SC
Most appraisers typically follow Fannie Mae's Uniform Residential Appraisal Report for single-family homes. This report requires appraisers to look at specific elements to determine the value of your home. Here are the main factors that can impact your home's value:
Repairs and Improvements
Any repairs and home improvements you've made over the years can positively impact your appraisal. Whether they're major projects like a new deck or minor improvements like new hardware on your kitchen cabinets, every repair and renovation counts and can help add value to your home.
Be sure to itemize each repair and the cost to show the appraiser. Not only will it help them determine your home's value, but without an itemized list they may not have been aware or noticed all of your repairs and improvements.
Visible Signs of Age and Deterioration
No matter the actual age of your home, you want it to appear as modern as possible. Get rid of the shag carpet and the old wallpaper and instead uncover those hardwood floors and give your walls a fresh coat of paint.
Any sign that your home hasn't been kept up can harm your appraisal results. This means any visible deterioration — like water stains, cracked tile, or cracked walls — can negatively impact your home's value.
First impressions matter. If the exterior of your home is reminiscent of a haunted house or a junkyard, your home's value will suffer. Make sure your home looks welcoming with trimmed trees and shrubs, planted flowers, a clear walkway, and without any peeling paint or broken siding.
While your home's location is out of your control, you want to make sure your appraiser knows everything desirable about it. Mention any positives of the area such as walkability, shopping centers, great schools, near public transportation, or a surge of new restaurants.
The Home Appraisal Process in Columbia, SC
To help ease the stress of a home appraisal here's a step-by-step guide to what you can expect during the appraisal process.
1. After you accept a buyer's offer, their lender will hire a licensed appraiser for an on-site appraisal.
2. During the appraisal, the appraiser will examine both the interior and exterior of your home looking at the overall condition, neighborhood, the quality of construction and building materials, structural integrity, layout, lot size, square footage, age, appliances, the roof and gutters, number of bedrooms and bathrooms, amenities, and more.
The appraisal may take anywhere from 15 minutes to several hours depending on the size and condition of your home. If your home is larger or has more issues, the appraiser may need more time.
4. Using both comps and the information gathered during the on-site appraisal, the appraiser will then fill out their report, typically 10 pages long.
5. The lender will receive the appraisal report usually within a week. As the seller, however, you'll need to request to see the report from the lender who must send it to you within 30 days. But, if the appraisal value came in low, your agent will be able to let you know before the 30 day timeframe.
6. If your appraisal is low, this can impact the buyer's ability to receive financing — their lender won't lend more than the home is worth. This is when you may need to renegotiate the sales price, appeal the appraisal, or potentially have the deal fall through.
7. Once you renegotiate for a lower price, or if the appraisal matched the initial offer price, you can move forward and close on your home.
How much does a home appraisal cost in Columbia, SC?
According to HomeAdvisor, on average, a home appraisal for your Columbia home will add up to about $331 with a typical range between $250 and $400. However, this cost can vary depending on your particular home. For instance, larger, more complex homes take longer to appraise and therefore will cost more.
Your appraisal may also cost more if your home boasts unique features or is vastly different from the majority of homes in the area. If the appraiser struggles to find available comps, they'll charge more for the extra research and time involved in valuing your home.
Other factors that can play a role in the cost are if your home has extensive damage or major repair issues requiring the appraiser to take more time to appraise it, or if poor weather conditions make it difficult for the appraiser to gain access to certain parts of your home.
Who pays for the home appraisal in Columbia, SC?
Traditionally, the buyer will cover the cost for the home appraisal. The buyer's lender is the one responsible for hiring an outside appraiser and then passes the bill onto the buyer.
Of course, if you choose to get a pre-listing appraisal or you're refinancing, you as the homeowner will be on the hook for the appraisal cost.
What Columbia, SC Home Sellers Need to Know
How to Prepare for a Home Appraisal
You want to show your home in its best light. While appraisers are supposed to be perfectly unbiased, they are human after all. If they have to step over piles of laundry or are tripping over your kid's toys this can subconsciously factor into their assessment.
It's ideal to do a deep clean of both the interior and exterior. You'll want to fix any visible problems such as water stains, soiled carpets, leaky faucets, and foul odors. And if you have any pets it's best to lock them away or take them on a long walk to stay out of the appraiser's way.
You'll also want to prepare in advance an itemized list of all the repairs and home improvements you've made, including their costs. This will help the appraiser assess your home, ensuring they won't miss any details.
How can I boost my home's appraised value?
One of the easiest and most impactful ways to boost your home's appraisal is by fixing small repairs around your home. And the best part? You don't have to break the bank to see a significant effect.
Any repairs to help bring down utility bills or to bring your home into the 21st century will help your appraisal results. For instance, replace the insulation in your attic or basement or put in energy-efficient windows to help heating and cooling bills.
Other affordable improvements include installing smart home technology such as an alarm system, video doorbell, or remote thermostat.
You also want your home to look as modern as possible. This can be as simple as replacing new hardware on your kitchen cabinets, a fresh coat of neutral-color paint in the bathroom and kitchen, or changing out old light fixtures with sleek, new models that brighten up your space.
How to Appeal a Low Appraisal
If you don't believe your appraisal results accurately reflect your home's worth, you do have the option to appeal. To challenge your appraisal you'll have to go through the lender — neither the seller nor the buyer can contact the appraiser directly.
The best action you can take is asking for a reconsiderations of value. You'll present the buyer's lender with new comps to make your case for any discrepancies in value. The majority of the time the appraiser is able to back up their decision, but if they did make a mistake the appraiser will adjust the initial appraised value.
Another option is to request a second appraisal. However, there's no guarantee the appraisal will produce different results; remember the process is designed to be objective.
What Columbia, SC Home Buyers Needs to Know About Appraisals
Who appraises the home and how do I know they will do a good job?
An objective, licensed appraiser hired by your lender will appraise the home. To do a good job the appraiser needs to remain unbiased and therefore cannot have a prior relationship or connection with you, the seller, or the lender. To accomplish this, typically your lender will request an appraiser from a third-party company who randomly assigns the job from a list of licensed appraisers.
You can rest easy that the majority of appraisers will do everything in their power to value your home accurately. In their reports, appraisers are required to explain and justify every finding that could impact your home's value. Plus, appraisers and their management companies are severely regulated and face harsh consequences for biased appraisals.
But, if you'd like to learn more about your assigned appraiser, you can check out their credentials with the government's national registry.
What if the home appraisal comes in low?
While not ideal, a low home appraisalisn't necessarily a dealbreaker. In some cases, the sale may fall through, but usually the seller and buyer are both motivated to make the sale happen and are open to negotiations.
You can work with your agent and the seller to renegotiate the sales price, lowering it to match the appraisal value. Another option is to ask for additional seller concessions such as repair credits or help paying for closing costs so freed up funds to cover the difference in price and your mortgage.
A low appraisal means a smaller loan, limiting your buying power. So if you truly have your heart set on a specific home, you may have to consider bringing more cash to the table to meet the seller's price.
Top Home Appraisal Companies in Columbia, SC
If you need to hire an appraiser for your home consider these Columbia companies.
- Ashley Urso Appraisals, LLC: 4.95-star rating on HomeAdvisor (14 reviews).
- Professional Appraisal Services, Inc: 5-star rating on Thumbtack (3 reviews).
- Columbia Real Estate Appraisal: 5-star rating on Google (9 reviews).
- A.M. Appraisals: 5-star rating on Google (1 review).
- JKS Appraisal Services Inc: 3-star rating on Google (2 reviews).
Columbia, SC Home Appraisal Resources
- General Knowledge of SC Home Appraiser Standards — Appraiser Career Center
- Appraiser License Verification — South Carolina Real Estate Appraisal Board
- Consumer Appraisal Information — Richland County Assessor's Office
- How to Appeal an Appraisal in Columbia — Richland County Board of Assessment Appeals
- South Carolina Appraisal Forum — AppraiserUSA