An Overview of the Appraisal Process

Their home's purchase is the largest transaction most will ever encounter. It doesn't matter if where you raise your family, a seasonal vacation home or a rental fixer upper, the purchase of real property is a detailed transaction that requires multiple people working in concert to pull it all off.

Practically all the participants are quite familiar. The most familiar face in the exchange is the real estate agent. Next, the lender provides the money required to finance the exchange. The title company makes sure that all requirements of the sale are completed and that a clear title passes from the seller to the purchaser.

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So, who's responsible for making sure the value of the property is consistent with the amount being paid? In comes the appraiser. We provide an unbiased opinion of what a buyer might expect to pay — or a seller receive — for a parcel of real estate, where both buyer and seller are informed parties. A licensed, certified, professional appraiser from Anna Hall Appraisals LLC will ensure, you as an interested party, are informed.

Where an appraisal starts

Our first responsibility at Anna Hall Appraisals LLC is to visit the property to determine its true status. We must see aspects of the property hands on, such as the number of bedrooms and bathrooms, the location, and so on, to ensure they truly are there and are in the shape a typical buyer would expect them to be. The site visit often includes a sketch of the house, ensuring the square footage is correct and conveying the layout of the property. Most importantly, the appraiser looks for any obvious amenities - or defects - that would affect the value of the house.

Once the site visit has been completed, we consider the three approaches to determining the value of the property: the sales comparison approach, the cost approach, or the income approach. The sales comparison approach, a comparable sales analysis, is included in all our appraisal reports. Typically it is found to be the only or most relevant approach to value. When other approaches to value are found to be relevant, they are included as second or third approaches to value to lend support to the sales comparison approach.

The Cost Approach

This is where we gather information on local building costs, labor rates and other elements to derive how much it would cost to replace the property being appraised. This estimate often sets the maximum on what a property would sell for.

The Sales Comparison Approach

Appraisers become very familiar with the communities in which they work. They understand the value of certain features to the people of that area. Then, the appraiser researches recent sales transactions in the vicinity and finds sold properties which are 'comparable' to the subject at hand. By researching market reactions, including dollar values assigned by the market, and applying those dollar value adjustments to certain items such as remodeled rooms, types of flooring, energy efficient items, patios and porches, or extra storage space, we adjust the recently sold comparable properties so that they are more accurately in line with the features of subject.

For example, if the comparable property has a screened porch and the subject does not, the appraiser may subtract the value of a screened porch from the sales price of the comparable.
But, in the case where the subject has something such as an extra half bath that a comparable doesn't have, the appraiser would add the value of that bath to the comparable property.

After all differences have been accounted for, the appraiser reconciles the adjusted sales prices of all the comps and then derives an opinion of what the subject could sell for. When it comes to valuing features of homes in Jacksonville and Onslow County, Anna Hall Appraisals LLC can't be beat. This approach to value is commonly awarded the most importance when an appraisal is for a home purchase or refinance.

The Income Approach

A third method of valuing approach to value is sometimes employed when an area has a measurable number of rental properties. In this situation, the amount of income the real estate produces is taken into consideration along with other rents in the area for comparable rental properties to derive the current value.

Putting It All Together

Examining the data from all approaches, the appraiser is then ready to document an estimated market value for the property at hand. The estimate of value on the appraisal report is not always the final sales price even though it is likely the best indication of what a property is worth. Prices can always be driven up or down by extenuating circumstances like the motivation or urgency of a seller or 'bidding wars'. Regardless, the appraised value is typically employed as a guideline for lenders who don't want to loan a buyer more money than the property is actually worth. At the end of the day, an appraiser from Anna Hall Appraisals LLC will help you get the most fair, balanced, and unbiased property value, so you can make the most informed real estate decisions.