Personal Service Realty's Residential Valuation Group has answers to "Frequently Asked Questions"
Personal Service Realty's Residential Valuation Group is willing to address any questions you might have about appraisals or real estate in Duval County.
Contact us today to talk about how we can help you with your specific valuation problems.
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An appraisal report is an investigation allowing the appraiser to come to an opinion of value.
This opinion or estimate is concluded through a formal method that usually utilizes three "common approaches to value".
One of the processes is the Cost Approach - which is how much capital would be required to replace the improvements, less physical deterioration and other factors, then adding the land value.
Another of the approaches is the Sales Comparison Approach - which involves finding a comparable analysis to other similar properties within a close proximity which have recently sold.
Being the most commonly used approach, the Sales Comparison Approach is generally the most accurate and best indicator of market value for a property.
The third approach is the Income Approach, which is the best method in appraising income producing properties - it deals with estimating what an investor would pay based on the income produced by the property.
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An appraiser produces a fair and credible opinion of market value, to be used in making real estate transactions.
Appraisers demonstrate their conclusions in appraisal reports.
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There are a lot of reasons to obtain an appraisal with the most common reason being real estate and mortgage transactions.
Some other reasons for getting an appraisal include:
If you are applying for a loan.
To lower your tax burden.
To show a homeowner has 30% equity and remove insurance.
To challenge inflated property taxes.
If you need to settle an estate.
To give you a leg-up when purchasing a home.
To find the most probable property value when listing your home.
To defend your rights if your property is being taken by means of eminent domain in a condemnation case.
Because an official agency such as the IRS requires it.
It's possible you could have to deal with being in a lawsuit - an appraisal will help.
If you need more information about the appraisal process, please click here.
The appraiser is not a home inspector and he or she does not do a complete home inspection.
A third-party home inspector will investigate the structure of the property, from the roof to the bottom.
Generally, a home inspection report will evaluate the amenities and the requirements of the house: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, accessible insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.
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To be blunt, it's night and day.
The CMA utilizes market trends to generate most of their business.
Appraisals use comparable sales which are verifiable resources.
Area and construction values are also a priority in an appraisal.
All a CMA does is generate a "ball park figure."
Delivering a defensible and careful analysis, an appraisal will give a clear opinion of value.
The person creating the report is hands down the biggest difference between a CMA and an appraisal.
A CMA is written by a real estate agent who may or may not have a true grasp of the market or valuation concepts.
The appraisal is produce by a licensed, certified professional who makes a living out of valuing properties.
Likewise, the agent has something at stake since they get a commission based on the property's selling price - their commission - whereas the appraiser is bound by a code of ethics to accept a previously agreed upon sum for assignments, regardless of their outcome.
Every report must demonstrate a believable estimate of value and should clearly state the following:
Who engaged the appraiser and other intended users.
How the appraisal is supposed to be used.
The reason for the assignment.
Precisely what "value" attribute is being reported and what that value means.
The effective date of the appraisal.(Sometimes this is in the past or maybe the future for new construction!)
Relevant property attributes, including: location, physical description, legal attributes, economic attributes, the real property interest in question, and non-real estate items included in the valuation, such as personal property, permanent equipment installations and even intangible factors.
Any known easements, restrictions, encumbrances, leases, reservations, covenants, contracts, declarations, special assessments, ordinances, and the like.
Division of interest, such as fractional interest, physical segment and partial holding.
What was included in the process of completing the appraisal.
For a more detailed look at the work that goes into an appraisal report click here: Sample Appraisal Report
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In communicating an appraisal report, each appraiser must see to it that each of the items below are covered:
That the information analysis implemented in the appraisal was appropriate.
Whether individually or collectively, there were no substantial errors contained in the report, nor any material details left out.
That appraisal services were not executed in a careless or negligent manner.
That a trustworthy, substantiated appraisal report was communicated.
To become a state licensed appraiser, we must fulfill intense education and experience requirements that train us to produce an unbiased opinion.
Likewise, appraisers must obey a strict industry code of ethics and observe national standards of practice for real estate appraisal. The tenets for carrying out an appraisal and communicating its results are insured by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).
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Typically, appraisers are called upon by lenders to render a value opinion on real estate involved in a loan transaction - to make sure the subject is truly adequate collateral for the loan.
Appraisers also provide opinions for legal settlements, tax matters and investment decisions.
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One of the primary things an appraiser does is to compile data.
Data can be divided into Specific or General. Specific data is taken from the property itself; Location, condition, amenities, size and other specific data are documented by the appraiser while on site.
General data is received from a many sources.
To find out about recently sold homes to be used as "comps", we often go to the local Multiple Listing Service.
To double-check actual sales prices, we research tax records and other public documents that are usually online nowadays.
Flood zone data is gathered from FEMA data outlets, such as a la mode's InterFlood product.
And last but not least, the appraiser assembles general data from his or her past experience in creating appraisals for other houses in the same market.
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If you're making any kind of financial decision and the value of your home matters, you'll want to hire a licensed appraiser.
If you're selling your house, an appraisal assists you in setting a price that maximizes profit and reduces time on the market.
When buying, be sure you're not overpaying by getting an independent appraisal.
For those settling an estate or divorce, an appraisal from Personal Service Realty's Residential Valuation Group is the best way to ensure assets are divided fairly.
A house is often the single, largest financial asset anybody owns. Without knowing its real value, wise financial decisions are impossible.
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PMI stands for Private Mortgage Insurance.
It covers the lender in the event a borrower defaults on the loan and the market price of the house is less than what is owed on the loan.
Once you can prove the amount you owe on your home is less than 80% of the home's market value, you can make a case to your lender to drop the PMI.
The savings from getting rid of the PMI required when you got your mortgage pays for the appraisal in a matter of months. Nobody is more qualified than Personal Service Realty's Residential Valuation Group when it comes to analyzing real estate appreciation in Jacksonville and Duval County. Contact us today.
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We begin with an inspection of the property.
What this entails is the appraiser, after setting up an appointment, personally going through the home - recording the layout of the rooms, taking photos and documenting the general status of its amenities.
On the home's interior, make sure it is clutter free and that we can access things like furnaces and water heaters. On the outside, trim any bushes so we can be free to get an accurate measurement of outside walls.
The following items, if available, will help your appraiser to provide a more accurate appraisal in a shorter period of time:
Any records on the purchase of the property for the last three years.
A list of any personal property that is part of the home and you intend to be sold with the home, such as a oven, or a washer and dryer, if applicable.
Title policy that lists encroachments or easements.
Any inspection reports, or other recent reports for termites, EIFS (synthetic stucco) wall systems, your septic system and wells.
A list of "proposed" improvements when the property is being appraised "as complete".
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In real estate appraising, Market Value is commonly defined as:
"The most probable price (in terms of money) which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: the buyer and seller are typically motivated; both parties are well informed or well advised, and acting in what they consider their best interests; a reasonable time is allowed for exposure in the open market; payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale."
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In most real estate transactions, the appraisal is ordered by the lender.
Even though it's the buyer that eventually pays for the report, the lender is the intended user. The
buyer is entitled to a copy of the appraisal - it's usually bundled with all the other closing documents - but is not entitled to use the report for any other purpose without permission from the lender.
It's different when it's the homeowner engaging the appraiser for things outside securing a mortgage.
In these scenarios, the appraiser may stipulate how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not stipulated otherwise, the home owner can use the appraisal for any purpose.
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This really depends on where the home is.
For example,
if you're in a neigborhood of small to medium priced homes, a media room may not be something people in that price range want
No matter where you go, however, renovating a kitchen is almost always a safe move.
One recent study revealed that putting $20,000 into a kitchen remodel would add about $17,500 to the value of the home - or about an 88% return on investment.
Bathrooms are right up there with kitchens, yielding 85%.
Adding bedrooms and baths can also help the value of your home (when done well) as long as your home doesn't then become overbuilt for your neighborhood in terms of size.
Personal Service Realty's Residential Valuation Group 4083 Sunbeam Rd., #1701 Jacksonville, FL 32257
