Posted: Sat Jul 25, 2009 8:42 pm Post subject: property appraisal with foreclosure properties around
I just have a question about appraisal. If i purchases a property. I had done some rehab on the property. However, there is several foreclosure going on in this neighborhood and their selling price is low. How would the appraisal determine the value of my house? Will the appraisal include the foreclosure sale in his calculation or just include the normal sale into his calculation? How will the appraisal determine the value of the house in this case? Thanks.
The appraisers would take a look at the value of the properties in your neighborhood with similar specifications and decide the value of your property. There are chances that the value of the property gets lowered due to the low value of properties in your neighborhood. _________________ Procrastination is the enemy of your financial sucess
The value of your property is based on an appraisers interpretation of the typical actions of market participants. Market value is primarily based on the principle of substitution, meaning that buyers will most likely purchase the lowest price adequate substitute (all things being equal)to your property. So if there are several post-foreclosures listed on the market for less money, put yourself in the buyers shoes and consider which one would you buy. That is the same thing that appraisers must consider in their valuation.
I will add however that most times foreclosures can be in inferior condition so if you have a home in good condition with upgrades and nicely decorated, you may have an advantage over some of the foreclosures. _________________ Benjamin Smith
Atlanta Area Appraiser
Apex Appraisals & Consulting, LLC
www.appraisalapex.com
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