Lisa, Home Buyer in Arlington, VA

How is a short sale appraised?

Asked by Lisa, Arlington, VA Mon Oct 13, 2008

Do you know definitively if forclosures and other short sales are included w/ an appraisal? I'm concerned about the process for a home I'm considering. The property is actually a home divided into many rooms and used as a rental property. It's run down and negleglected. Will this likely be reflected in the appraisal or will the homes' large size preempt the other issues and keep the value high based on the good geography?

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Lisa,
Appraisals are actually fairly standard though some properties are more difficult than others. A typical appraisal for a mortgage lender will even use a standardized format such as the Uniform Residential Appraisal Report. Raw land and income producing property might use a narrative format or both.

While good geography may be useful the purpose of the appraisal, especially for a mortgage lender, is to establish the Market Value. This will take property condition, age, and location into consideration and then compare it to like property that has recently sold. If the property is in poor condition the market value will be adjusted downward to reflect the need for repairs or updating (an out of date kitchen is not worth as much as one that has been recently updated).

For more detailed information consult your local Realtor or look up real estate appraisals on Wikipedia.
0 votes Thank Flag Link Mon Oct 13, 2008
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