Home Appraisals – Understanding the Process & What It Means

Home Appraisals – Understanding the Process & What It Means

Home appraisal is basically a valuation of your property. When getting luxury real estate in Las Vegas appraised, the authorized person, known as an appraiser, determines the value based on market forces, condition, and other elements, helping you determine the selling price of your property.

Home appraisals are most commonly used for insurance and taxation purposes by the government, but individuals and businesses can also use the same service to determine the selling price of your real estate or asset respectively.

The Benefit of a Home Appraisal

Appraisals aren’t just to ensure that you pay the full tax amount, but also serve to protect homeowners and sellers from too high or low prices. Tax authorities are able to make sure that in case the price of the luxury real estate goes down, the IRS doesn’t end up charging more than it should.

Even buyers can choose to get a property appraised, but we would advise against the same. If you feel like a homeowner is charging too much for a home, we would recommend you give it a hard pass, instead of having it appraised.

How Much Does a Home Appraisal Cost?

Usually, it’s the homeowner or a mortgage lender who appraises the real estate and pays for it, but at the end of the day, these costs are ultimately transferred to the buyer. Appraisal fee varies from place to place and, of course, depends on the size of your property.

On average, appraisals cost somewhere between $450 and $800. However, it isn’t uncommon for luxury real estate in Las Vegas to cost up to $1,000, considering the vastness of some houses. We highly encourage you to make offers to the appraisers and negotiate prices, though. There is no fixed cost determined by a board or the government.

Understanding the Appraisal Process

The appraisal ‘process’ begins right after you make a phone call to an appraising company or individual appraiser. This usually happens after you have made an offer to the buyer or are thinking about doing the same.

Appraiser(s) come to your property and inspect it thoroughly. From the material used all the way to its condition, the utilities, location, amenities, and more, everything is considered to make a reliable estimate of a fair value.

According to the Appraisal Institute, Appraisers use the Uniform Residential Appraisal Report for single family homes, in which the report requests the appraiser to describe:

  • The interior and exterior of the property
  • The neighborhood
  • Nearby sales and their values

After everything is added, the appraisers make their observations and present you with a report. The report includes:

  • A street map of the neighborhood showing comparable sales
  • A sketch of the building’s exterior
  • How the square footage is calculated
  • Photographs of the home
  • Photographs of the view from a given house
  • Market sales data
  • Public land records
  • Tax records
  • And other relevant data

Once the data is compiled, a fair market value is determined and written in the report.

Disclaimer: There are numerous factors to consider in every investment, including real estate. The information provided above is just a matter of opinion and can change with time. It shouldn’t be construed as legal or tax advice; neither does the report constitute a financial promotion or investment advice. It is general information and before making any such decision, you should seek out licensed professionals and see all ends clearly.