Oct. 31, 2007 - Who Knows The Value of a Property?

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Who Knows The Value Of A Property . . . Appraiser or Seller?

Having a real estate appraisal background, we can relate to the above topic very well. The typical approach used by the appraiser to complete the job for the client in a professional manner is utilizing the Market Data Approach.

Choosing comparable properties from the immediate neighborhood gives the appraiser the strongest support for a sales price for the subject property provided there is sufficient similarity in the type of structure, construction material and square footage.

A buyer will have his own idea of what the property is worth to him and, if an appraisal is available for his review, might consider the appraised value as a gauge as to where he will start his offer. The appraised value reached by the appraiser might not be the sales price reached by the seller and buyer.

Once the offer is made, the seller has a starting point for negotiations over various points of the offer but especially the offered amount which may end up above or below the appraised value. In today's market, appraisals generally are done after negotiations are concluded at the request ot the buyer's lender. However, if lenders would accept all appraisals from all licensed appraisers (rather than only those done by appraisers who are lender staffed or lender approved), it could benefit all by having the appraisal done prior to the property ever going on the market.

Resource: Mary and Joe Skye, www.TxHomeSearch.com, E-mail: Skye@TxHomeSearch.com