When buying or selling a home, you will likely interact with a home appraisal at some point.
Appraisals are an important part of your home-buying experience. A real estate appraisal helps to establish a property’s market value, the likely sales price it would bring if offered in an open and competitive real estate market.
Your lender will require an appraisal when you ask to use a home or other real estate as security for a loan, because it wants to make sure that the property will sell for at least the amount of money it is lending.
This is where the home appraiser comes in. He or she devises a report with the home’s assessed value, based on several factors. In turn, the bank considers the report when deciding whether or not to lend you the money.
More than likely you will always be on the consumer side of the transaction, but one industry expert lets you know what it’s like on the inside. Home appraisal is especially appealing to stay-at-home moms or dads, as the hours are flexible, says residential real estate agent Barry Barnhorn. Working as an independent agent, appointments can be set up around your schedule.
But before you dive into the field, Barnhorn suggests doing some research. First, he suggests taking real estate classes to get a feel for the business. “See if you like it, then make a decision,” he advises.
And training is critical to one’s success, he says. This training is both on the job and in the classroom. Some established home appraisers are willing to take aspiring appraisers under their wing like an apprenticeship. This involves doing appraisal work for the respective appraiser without pay.
This real-world experience is key to success, but it doesn’t come without sacrifice. Barnhorn advises having a year’s worth of salary saved before getting fully immersed in the business. Expenses like supplies and gas add up quickly, so a financial support system is critical to remaining afloat.
The courses involve a commitment of between 120 and 180 hours, or possibly more for a certified appraiser, Barnhorn says.
Following coursework and training, Appraisers can work to attain one of four levels: test trainee, residential licensee, certified residential appraiser and certified general appraiser. The latter means an appraiser can assess any property in the respective state.
Barnhorn, a certified general appraiser, says prospecting and research are keys to success. In general, 70 percent of business comes from inside and the remaining 30 percent results from outside research.
Like any business, you reap what you sow, Barnhorn says. As a certified general appraiser, he works for major corporations. “I’m qualified because I have been doing it a while,” he says.
Home sellers should note a few tips when preparing a home for an appraisal, he says. First, be sure that no dishes are in the sink. In general, the home should be properly maintained. Furthermore, he says home-owners should invest in “fixed things,” like kitchen and bathroom renovations.
Home sellers should note a rule of thumb when it comes to home appraisal. “A property is not worth more than the highest or lowers value in a subdivision,” he says. This means there is only so much you can invest in a home to significantly enhance its value.
Photo: Courtesy of Barry Barnhorn