Essential Real Estate Appraisal Data From Site Inspections
An on-site inspection is a significant part of any real estate transaction, especially a real estate appraisal. An inspector, usually a real estate agent or licensed appraiser, performs a visual observation of the property to identify the relevant safety, health, and other issues of the site.
In a nutshell, inspections do not just deliver a general impression of the overall physical condition but also reveals those areas that needed an in-depth investigation, like foundations and structural framing, roof conditions, and home ventilation. Inspections are vital because what the inspector or appraiser may conclude about the property will have an influence on the property’s selling price.
All the major components, such as plumbing and electrical components, on the site, will be inspected and tested. Home interiors and exteriors are to be checked for additions and repairs which affect property evaluation. Relevant findings will be detailed in a thorough report, usually a real estate appraisal, with the property’s issues or potential issues described in detail. Knowing what information to look for beforehand helps in gathering accurate data and providing compliant property valuation.
A property sketch must show sufficient details, such as the exact square footage of the subject property and the dimensions of the areas inside and outside the property. Also, it should have text to identify property components such as living and non-living spaces, patios, and garages. The property sketch must be drafted down to a scale to represent the site size accurately.
Appraisers may provide detailed descriptions of every part of the house and its surrounding areas, but a visual representation of what the appraiser saw firsthand adds credibility to the report. If the appraiser simply got the numbers from the MLS, it might not be as accurate because the information might be a few years old and there might have been changes to the property.
Property photos are essential to appraisers. Based on these images, appraisers will be able to justify their property valuation. Both interior and exterior areas must be photographed, including views as seen from different parts of the property.
Areas include the front, rear, and street view. Rooms include kitchen and dining area (including a breakfast nook, if there was one), laundry area, living room, family room, bathrooms, and bedrooms.
It’s also important that photos of the carbon monoxide/smoke detectors, water heating system, indoor temperature control system, lighting system, and security system, if available, are included.
Photos will help appraisers as well as other people who check the report to determine the current condition of the area and the property structures. With those quality images, appraisers can clearly describe the property they are appraising and deliver an outstanding report.
A real estate appraisal report makes up a lot of checkboxes and data fields. There are pieces of information that real estate appraisers need to answer before they’re able to complete the report. Here are specific questions for the real estate appraiser to answer:
- Occupant – Occupant details such as name and status, whether as an owner or a tenant, are important.
- HOA Fee (or in MLS Listing) – This states how much the occupant pays as monthly or annual fee to the homeowner’s association. The appraiser can ask his or her contact for the property inspection or simply check the MLS listing for the HOA fee, if it’s indicated.
- View of the subject, site/location comments – This may be an aerial view or street view (or both) of the subject and may include notes about the area, if it is a new development or in a rural land.
- Concrete/crawl space – For property identification, this specifies whether there’s a crawl space or not and if it was viewable or not.
- Effective age – This is the age of the property based upon its condition. A well-maintained property may have an effective age that’s younger than its actual age.
- Heating/cooling system – It states whether there’s a heating and cooling system present in the property, such as air conditioning and heat ventilators.
- Ask if there’s a solar panel system – There are properties that run on solar and that may add value to the property.
- Condition and quality – There are standardized conditions and quality ratings, depending on the property’s health, that the appraisers must utilize.
- Functional or external obsolescence, etc. – State the element of depreciation: Is it economic (external) obsolescence, or functional (technical) obsolescence? Then, find out if it is curable or incurable.
Site inspections typically take a few minutes to an hour, so you must know beforehand what important appraisal information is needed from an on-site inspection. Gathering data within that time frame requires collaboration with your own team of real estate appraisal back-office assistants.
Because there are a multitude of fields in an appraisal report form that need to be filled accurately, you’ll need people who have been trained and have years of experience in handling such information even when they are working remotely.
If this is something you’d like to explore with us, then click the button below to get started. Set an appointment with our outsourcing consultant and learn how you can hire your own team of real estate back-office assistants.