There are always a few tense moments during a real estate transaction with one of the biggest pressure points being the home appraisal. What a home appraises for can derail the entire sale if it prevents the buyer from getting financing.
But don't worry! There are ways to prepare and ensure a home appraises for the highest amount possible.
One of the safest bets is letting a top real estate agent guide you through the appraisal. If you work with an experienced, local agent, they can evaluate the property, analyze similar home sales in your local area, and help you understand the value of the home. This will lead to more accurate listing prices and buyers' offers that will align with the appraisal.
> Reach out for a free consultation and to interview top-rated agents with years of experience handling sales and appraisals in Las Vegas.
Want to know exactly what goes into a home appraisal, how it determines your house's value, and how to increase that value? We've put together a guide with everything you need to know.
What is a home appraisal?
A home appraisal is an independent opinion of the current value of a home, usually formed at the request of the buyer's lender. This assessment is done by a licensed appraiser who provides an unbiased evaluation of the house.
During an onsite visit, the appraiser will look at the property's overall condition, size, finishing details, and location, as well as information about your neighborhood and recent, nearby comparable sales (known as “comps”).
When does a home appraisal happen?
The appraisal usually happens after an offer is accepted and can be a nerve-wracking time for both buyer and seller. Lenders want to make sure they don't loan out more than a home is worth; the house would then be insufficient collateral if the borrower defaults. If the appraisal value is low, it will impact how much financing buyers can secure.
There are other times a home might be appraised. To refinance your mortgage, you'll need a new appraisal, for instance. A seller might have their own appraisal done before a sale to help figure out how to price their home.
It should be noted that while an appraisal can give you a good starting point for pricing, a Las Vegas real estate agent who knows the market can use their experience to evaluate and price your home to sell.
Market Value vs. Appraised Value
While market value and appraised value seem similar, there are important distinctions.
Market value is the price a buyer is willing to pay for your home, making it highly subjective. If a buyer absolutely loves your house because it reminds them of their childhood home, they might be willing to pay more, leading to a higher market value.
Appraised value is the house's current worth as assessed by an unbiased, licensed appraiser. The appraiser looks at recent sales data in the area and objective factors like the home's overall condition, age, size, and aesthetic details to determine its appraised value. This is the amount a lender will use to determine how much to give to the borrower.
Because they are based on different criteria, market value and appraised value are not always the same.
For example, in Las Vegas, the median home value (what it might appraise for) is $274,000 according to August 2019 data from Zillow. The median sales price (market value) is a bit lower at $269,400.
Factors Impacting a Home Appraisal in Las Vegas
The home appraisal takes into account the physical attributes of your home, recent nearby sales, and data about the neighborhood your house is in, such as housing and economic trends, available utilities, local schools, taxes, and zoning.
Here are a few of the things that impact the outcome of a home appraisal in Las Vegas.
Repairs and Improvements
Any significant improvements you have put into your home will help boost its value. If you did any renovations, landscaping improvements, or appliance upgrades, let the appraiser know when they were done and how much they cost. Any documentation you have will be appreciated by the appraiser.
If you bought your house for $200,000 and put $40,000 worth of renovations into it, you'll want to make sure that work is reflected in the appraised value. But know, the amount you spent will not exactly equate to the increased appraised value. Renovations that cost $40,000 five years ago do not add $40,000 worth of value today.
Visible Signs of Age and Deterioration
Newer homes aren't necessarily always worth more than older homes, but regardless of age, the better maintained your house appears, the more value it'll have. Any parts of a house that are damaged, rusty, musty, or moldy will hurt its appraised value.
There are easy improvements you can make to take years off your home's appearance.
Stained ceilings or cracks and holes in walls will be a red flag. Consider adding a fresh coat of paint in a neutral color and patching holes. Replacing worn out carpets can make a big visible improvement to a space, and likewise updated flooring will add value.
Although the appraiser is going to spend more time looking at the interior of your house, it won't do you any favors if your home lacks curb appeal.
Homes with overgrown lawns, cracked driveways, and broken siding will appraise for less.
To help boost your home's curb appeal, put some work into its exterior. Clearing overgrown brush, putting fresh mulch in beds, or getting your driveway repaved will help.
Appraisers will look at data and trends about your neighborhood. They'll consider the prices of recent sales and current listings, population growth in the area, and whether the supply of the market is meeting current demand.
Be sure to point out positive developments in the neighborhood that add value, like road repairs, or a new, highly rated school.
The Home Appraisal Process in Las Vegas
If an appraisal is ordered by a lender, it will happen after the buyer and seller have agreed upon a sales price.
The actual home appraisal visit won't take more than a few hours, but the whole process can take about five business days. Here's an overview of how it happens.
A licensed, independent appraiser will visit your home and complete a thorough walkthrough, inspecting the house, the property, and any other structures.
During the visit, the appraiser will document physical characteristics, both inside and outside the house, including:
- Number of bedrooms and bathrooms
- Square footage
- Overall condition
- Construction quality
- Compliance to code
- Views from the house
- If the house is in a flood zone
- Amenities like fireplaces, pools, patios, etc.
They will also consider home improvements you've made like room remodels, new systems and appliances, or refinished flooring.
After the onsite visit, the appraiser will write up a report assigning an appraised value to the home. The report will cover everything observed during the visit, as well as information about comparable homes and neighborhood insights.
It typically takes about three to five business days for the appraiser to prepare a full report and deliver it to the buyer's lender.
If the appraised value of the home is sufficient, the lender will agree to loan the buyer that amount to make the purchase. If it is low, the buyer may need to make a higher down payment or negotiate a lower price with the seller.
How much does a home appraisal cost in Las Vegas?
Appraisal fees vary, but a typical range in Las Vegas is between $286 and $412. If the home is unconventional or significantly larger than normal, it will cost more to have it appraised.
Who pays for the home appraisal in Las Vegas?
In Nevada, the buyer usually pays for the home appraisal.
It should be noted that since the appraisal fee goes directly to the appraiser for their services, it is nonrefundable, even if the buyer is unable to secure financing.
What Las Vegas Home Sellers Need to Know
How to Prepare for a Home Appraisal
Before your appraisal, prep information to pass on to the appraiser about improvements you've made to the house. Take a walk through your home, see if there are any quick upgrades or fixes you can make, and give it as thorough a tidying up as you can.
A qualified agent can help you prepare by gathering comps of similar properties to give you an idea of what results to expect. This will also help you price the home properly, so you can find qualified buyers more quickly.
How can I boost my home's appraised value?
Though the appraiser will be looking at some factors beyond your control, you can make a good impression by dedicating some time and a small budget to making repairs to your home. Home appraisers generally use $500 increments to value a home so when considering which repairs to make use that to help set your budget.
Any improvements to update aged fixtures, brighten and freshen up rooms, and give an overall impression of a home that is well-cared for will help.
Inside the house, try painting and plastering stained walls, cleaning or replacing old carpets, and fixing broken appliances. On the exterior, you can improve first impressions with easy aesthetic fixes like removing overgrowth in the yard, and scraping and redoing peeling paint.
How to appeal a low appraisal
As one of the most important parts of the sales process, a low appraisal can hurt your ability to get the best value for your home.
It is generally not easy to overturn the outcome of an appraisal, but there are steps to take to challenge your valuation if you think the appraiser made an error in fact or in judgment.
Go over the report with a fine-tooth comb to look for any mistakes they might have made. Check to see if they made any factual errors, like miscalculating square footage or listing your property in the wrong neighborhood.
It may be possible to argue that the appraiser picked bad comps for your house — maybe the homes they picked were more distressed, older, or in a different school district.
If the lender rejects your appeal, you could hire another appraiser yourself, though keep in mind that the lender isn't likely to accept your appraiser's results even if they show a different value.
On the other hand, if your appraiser does find your home is worth more than the first appraisal value, you might decide to hold out for a better offer.
What Las Vegas Home Buyers Need to Know About Appraisals
Who appraises the home and how do I know they will do a good job?
In Las Vegas, appraisers are certified and regulated through the Nevada Real Estate Division.
If you're borrowing money to purchase a home, your lender will use a third party to hire an unbiased local appraiser. The appraiser is not allowed to have a financial relationship with the lender.
To become certified, home appraisers go through an educational and training process. In Las Vegas, they are required to maintain and renew their certification and licensing throughout their career. To verify your appraiser's credentials, you can find their information through the government's National Registry of Appraisers.
What if the home appraisal comes in low?
If the appraisal comes in low, the buyer and the seller still have options to complete the sale. A low appraisal doesn't mean the lender won't provide a loan — they'll just loan the appraised value of the home.
The seller may decide to lower their price in order to get a sale done. After all, even if they find another buyer, chances are the appraisal will still come in lower than they'd like.
If the seller won't come down, the buyer will need to make up the difference. Sometimes this can be paid in cash (though some lenders don't allow this) or the buyer can free up funds by having the seller cover certain closing costs.
Top Home Appraisal Companies in Las Vegas
- Appraisal Services: 5-star rating on Google (26 reviews).
- Las Vegas Appraisal Co.: 5-star rating on Google (15 reviews).
- Eagle Home Appraisal: 5-star rating on Google (12 reviews).
- U.S. Appraisal Pros: 5-star rating on Google (3 reviews).
- A.S.A.P. Appraisals: 4-star rating on Google (3 reviews).
Las Vegas Home Appraisal Resources
- Real Property Information - Clark County Assessor - Information from the Clark County Assessor's office describing how they calculate property tax values. Includes information about appealing property tax appraisals if you feel yours is inaccurate.
- Remodeling and Rehabbing: Some Valuable Hints for Homeowners - Appraisal Institute - From the Appraisal Institute, this guide has advice for a homeowner or seller on planning home improvements to satisfy appraisers and buyers.
- Appraisal Report Descriptions in Las Vegas - Clear Valuation, Inc. - Appraisers don't have one set checklist when they assess a property. This resource describes the various different types of inspection reports an appraiser might complete.
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