Blog - Definitive Valuations

Top 10 Renovations That Cost More Than They Are Worth

October 1, 2019/0 Comments/in Home Improvements and Value /by Emilie Dover

There are many renovations that cost more than they are worth when it comes time to put
your house on the market. Home upgrades come in many different shapes and sizes. While
everyone has their ideas of what will increase their home’s value, there are several
renovations to steer clear of.

Going Overboard

Before you consider remodeling anything in your home, get a general idea of what other
houses in your neighborhood are doing. This will have an impact on your appraisal value. Be
cautious of going overboard with renovations, as this may prove to be a waste of time and
money in the end. (An appraiser calls this “over-improvement” for the market.)

Designs and Fixtures

Prior to implementing new designs and fixtures in your home, ensure these things will flow
well for the buyer that will be walking through. Do the new designs and fixtures make sense
to the rest of the home’s style?

Landscaping

When an appraiser is performing a market analysis, he or she must be able to prove that a
typical buyer will pay more for these renovations, like upgraded landscaping. Fountains,
rock walls, and intricate landscape patterns will indeed enhance the beauty of your yard,
but these things won’t lure buyers to pay extra for them. Buyers may see maintenance,
watering and weeding in what you see as beauty.

Sheetrock

A renovation that certainly costs more than it is worth is hanging new sheetrock. This is not
necessary. Consider a cheaper alternative by patching your current sheetrock and putting a fresh coat of paint on it.

High-End Upgrades

A lot of times, high-end upgrades are personal preference items. These include things such
as:

Swimming pool
Sauna
Steam shower
Heated floors
Sound systems

Keep in mind what a typical buyer will be looking for and expecting in your market. These
items take a large chunk from your budget and do not contribute enough value to your
home’s resale price. Steer clear of this renovation that costs more than it is worth.

New Flooring

Although you should ensure your floors are in good shape and do not show any signs of
damage, totally replacing them is a renovation that could cost more than it is worth.
Consider having your carpets or hardwood floors professionally cleaned. This process will be
much more worth your time.

New Front Door

A renovation that certainly costs more than it is worth is replacing the front door. Curb
appeal is a factor in the appraisal value, however there are much more cost effective
methods to improving this area. Simply clean up the front area of your home. Pressure wash
the area or simply add a new coat of paint.

Upgrading Electrical Systems

Upgrading your electrical systems is another renovation that certainly costs more than it is
worth. If you do not have a current problem with your electrical system, do not touch it.

Kitchen and Bathroom Renovations

While the kitchen and bathroom are the two rooms in which home renovations have the
most impact, it is important to not go overboard. You can freshen up your space without
replacing everything. Incorporate a new paint color, change out your fixtures, faucets, and
lighting. These minor upgrades will give your rooms a completely different look without
gutting everything and starting fresh.

Floor Plan Alterations

When considering home renovations, steer clear of making floor plan alterations. It is never
wise to take rooms away. Often times, a homeowner will take two smaller bedrooms and make one larger bedroom. However, this often results in an odd floor plan, which is not
appealing to buyers.

Definitive Valuations is here to help you determine what a renovation project will actually
add in value to your house before you get started. Contact us today!

Definitive Valuations is North Alabama’s premiere appraisal firm. Our mission is to provide
superior valuation and consulting services in Huntsville, Alabama, and surrounding areas.
Our staff strives to understand your needs and to provide the best solution for your
situation – whether for financial planning, relocation, tax dispute, legal matters, pre-listing,
or any other purposes. Discover more here.

Three Approaches to Appraisal Value

September 1, 2019/0 Comments/in Uncategorized /by Emilie Dover

There are three common methods of determining appraisal value. Home appraisals
incorporate established techniques and methods to arrive at consistent and reliable
valuations. Appraising relies on these three approaches to determining value for any given
piece of property: sales comparison approach, income approach, and the cost approach.
These methods vary based on the type of property you are purchasing.

Sales Comparison Approach

The sales comparison appraisal approach is used for standard, single-family homes, and is
the most commonly relied up and sought after in the residential lending industry. This
approach looks at the sales of other similar properties. They are compared/contrasted, and
based on their similarities and differences, an appropriate value is derived. This method
ensures a fair value is determined for the home within the market and aids banks in their
lending decisions by providing them with an unbiased opinion of fair market value for the
collateral backing a given mortgage loan. This approach is also often used by realtors and
homeowners in determining list price for a property going up for sale.

Income Approach

The income approach is implemented primarily to evaluate properties that have income
potential, such as rental apartment buildings, office buildings, or shopping centers, but is
also used in residential real estate when a property is going to be tenant occupied. The
theory behind this method of appraisal value is that a property’s value is a function of it’s
potential to bring income. Properties can command a specific amount in rent and will also
have certain expenses which will need to be taken into consideration.

A residential real estate appraiser will often use the Gross Rent Multiplier or GRM for
estimating value. GRM uses the gross rentals of a property. This calculation can be done in
one of two ways using either gross potential income or gross operating income. The value
estimate is better using the gross operating income because losses for occupancy and non-
payment are taken into consideration.

Cost Approach

The cost approach is the easiest but least used method of appraisal value. This method is
typically used for commercial property that will not be used as an income property, or larger
properties that have to be built from the ground up or drastically remodeled.

The land and property are assessed separately in the cost appraisal approach, in order to get
an understanding of what the overall value would be. The depreciation that could take place
over time is then taken into consideration and subtracted from the value amount. Lastly,
similar existing buildings will also be assessed to ensure the value is on par in comparison to
other properties.

For residential real estate appraisals, one, two, or all three approaches to value may be
employed and your appraiser should reconcile the methods employed before determining
their final value opinion.

There are many reasons to receive an appraisal from Definitive Valuations to include:

Determining list price for the sale of your home
Getting an unbiased opinion to confirm value for a cash sale
Reduce property tax obligations when a property is valued too high by your taxing authority
Valuation needed to deal with an estate
Determine honest property value for other financial or litigation needs

No matter the reason, Definitive Valuations is here to help. Contact us today!

The Importance of Previous Purchases to Appraisers

August 1, 2019/0 Comments/in Uncategorized /by Emilie Dover

How much weight do appraisers put toward previous purchases when completing a home
appraisal? Often times, looking at the past can help us understand the present. It’s
important to consider the factors that impact a previous purchase in the ever-changing
market of real estate.

An appraiser is required to analyze and report the past 36 months of transfers of the subject
property. Analysis of a prior sale can be normal and even mandatory in the appraisal
process.

If a property sold at a reasonable price, an appraiser could give strong weight to that sale. In
this scenario, an appraiser will take a closer look at exactly how the market and property
have changed since the sale.

On the other hand, a previous purchase could be considered meaningless if a property sold
for too little or too much in the past. In this case, an appraiser will not give real value weight
to this type of purchase.

When the Previous Purchase Means Less

Trustees Sale

This type of sale tends to go for a discount. Properties are typically not in great condition in
this scenario.

Fixer-Upper

If a home was in need of significant work, it most likely sold at a lower price. Chances are,
the home received major upgrades since the previous purchase. In this case, the previous
purchase value means less.

Family Discount

If a home was sold between family members, it is likely the previous purchase price will not
be a reliable source of information for today’s market. These types of sales often include a
discount to the actual value.

Factors to Consider

Timing

Before giving weight to a previous sale, an appraiser will assess whether it was a reasonable
representation of value at the time.

Context

Often times, a previous purchase is an incredible way to understand how a property fits into
the market. If a subject property has competed at approximately the same price position
within the previous three sales, an appraiser will likely give strong weight to those previous
sales. This helps one understand value for that particular property.

Adjustments

A prior sale can help determine how much the value should adjust for certain features of
the property. Is the home located on a busy street? A previous sale gives insight into
whether this was a big deal or not compared to surrounding neighborhood sales. This
research is effective insight into seeing what buyers have been previously willing to pay for.

Current Market

An appraiser will be objective by giving the most weight to the current market. You should
not get stuck on the previous purchase price and forget about the current market. Values
could have increased or softened since that previous purchase. The market could be
different today due to things such as:

Change in zoning
Change in buyer demand
Gentrification

No matter the previous purchase price, it is important to compare that to today’s market.

Previous purchases help appraisers to uncover how any recent improvements or changes
impact the overall value of the property. However, no matter the history of the property,
it’s important to consider all factors that impact the overall value in the ever-changing
market of real estate.

Inside Out or Outside In? The Best Methods for Appraisal Inspections

July 1, 2019/0 Comments/in Home Improvements and Value /by Emilie Dover

When it comes to the best method for appraisal inspections, it actually comes down to
personal preference. An appraiser will determine the process that works best for them –
whether that is working from the inside out, or the outside in.

While there is no set rule when it comes to the best method for appraisal inspections, the
popular choice is going from the outside in, meaning an appraiser will measure the outside
of the property first, and then move inside. Let’s look at the least popular method first.

The Inside-Out Method

One key benefit to the inside-out method of home appraisals is that the appraiser only has
to knock on the front door once. Additionally, the appraiser can interview the homeowner
first so they can look for items on the outside of the home that was mentioned when they
get outside, such as sprinkler systems, a well, septic systems, and more.

Those appraisers who work in crazier weather tend to favor this approach because they can
avoid bringing dirt into the home. Once the interior part of the appraisal is done, the outside
work can be taken care of next.

The Outside-In Method

The best part of the Outside-In method is that the appraiser can start with a wide footprint
of the property beforehand. An appraiser can determine the amenities on the outside,
survey the exterior, then ask questions about his or her findings when they move to the
interior of the home. Additionally, an appraiser can double check measurements from the
inside.

The downside to implementing this method in your appraising techniques is that it is more
time-consuming and requires the homeowner to come to the door twice. However, this
approach is most popular with appraisers because it can be more difficult to complete the
sketch without the footprint first.

How to Prepare for a Home Appraisal

June 1, 2019/0 Comments/in Home Improvements and Value /by Emilie Dover

The best thing a homeowner can do to prepare for a home appraisal is to ensure an appraiser has easy access to the exterior and interior of the home.

The first step in most appraisals is the property inspection. An appraiser will record the layout of the rooms, take photos, and document the general condition of the home. The appraiser provides a professional, unbiased determination of market value to be used in real estate transactions.

When you prepare for a home appraisal, the process does not have to be complicated. Consider these tips, but don’t become overwhelmed. Do as much as you can, and if you can’t do anything except let the appraiser in, then just do that and don’t sweat it!

Clean up the clutter.

Clean your home up on the inside and outside. Because the first step of the appraisal is property inspection, it is beneficial (though not necessary) to trim any bushes and relocate items that would make it difficult for an appraiser to measure the structure. Ensure an appraiser will have easy access to items such as furnaces and water heaters.

Enhance your home’s curb appeal by maintaining the landscape. Consider these simple tips to boost your appraisal value.

Mow the lawn
Mulch flower beds
Put a fresh coat of paint on the door
Pressure wash the curb, porch, and driveway

Another simple tip to prepare for a home appraisal is to turn on the lights in your home. This makes it easier for the appraiser to walk through and see everything.

Make minor fixes.

A great way to prepare for a home appraisal is by walking through your home to see if you
find any noticeable issues. Do you have rotted wood or rusted gutters? These are quick-fix
items that require minor updating.

Additional items that could require minor fixes include:

Heating and cooling systems are serviced and in functional condition
Appliances are operational and well-maintained
Leaks are patched
Broken windows are replaced
Cracks in the walls are patched and painted

It is important to remember that the current condition and functionality of the home is
more important to the appraiser than the age of the home.

Compile a list of previous home renovations.

If your home has undergone previous home renovations, compile a list of those things and
make it available to the appraiser. Your appraiser may or may not want to see all the details,
below, but at least having a list of what has been done will be welcomed by all appraisers!
You can opt to pull a folder together and include:

Receipts
Before and after photos of renovations
Taxation details
Permits

An appraiser is primarily looking at the condition of your home. This is one of the primary
things that helps to determine where your house will place in the market. Any maintenance
or renovation item is important information for the appraiser to have.

When an appraiser visits your home, he or she will take notes of everything that is part of
the property. An appraiser will assess the condition of your home and how well it has been
maintained. The process does not have to be stressful. Consider these tips to best prepare
for a home appraisal!

12 Factors to Consider for Your Next Home Appraisal

May 1, 2019/0 Comments/in Home Improvements and Value /by Emilie Dover

There are several factors that may impact your home appraisal value. The main purpose of
an appraisal report is to give a value opinion. Each factor within an appraisal report has its
own impact on the final value of the property. A home appraisal is crucial to place your
home on the market fairly, based on a comparable set of standards and the surrounding
area.
Check out these 12 factors that can influence your home appraisal value.

Location

One of the factors taken into consideration when valuing a home is its location. The location
includes not just the neighborhood your home is in, but where it is positioned within the
neighborhood. A larger lot in the back of the neighborhood may (or may not) be worth more
than a corner lot parallel to the main road.
A neighborhood’s value is based on factors including proximity to schools and hospitals, the
rating of nearby school systems, and surrounding amenities such as parks and shopping
centers.

Structural Materials and Updates

Another factor taken into consideration when determining appraised value is the materials
used to build your home and/or recent updating completed. The value may increase if your
home was built more recently with modern materials. The appraiser also considers updates
that have been made to items such as the roof, siding, or windows. These things improve
the overall efficiency and safety of the structure of your home, but are often be considered
maintenance items. (You wouldn’t consider purchasing a home with no roof would you?)
However, there are other updates that can be made to make a home more appealing to the
current market, such as remodeling kitchens and bathrooms, replacing floor covering, and
fresh paint.

Age

A newer home doesn’t always appraise higher than an older home. There are pros and cons
to older and newer homes. New homes, built within the last 10-20 years, are less likely to
have major issues and are lower risk to buy. This may increase the home’s appraised value.
On the other hand, in some markets, older homes located in historic districts may demand
higher prices in the market.

Design Style

A home appraisal also takes into consideration the overall design of the home. In some
markets (but not all), design differences can mean differences in values when all other
things are equal.

Curb Appeal

Curb appeal and general landscaping of the home may also impact a home’s value. Although
it may/may not be possible for an appraiser to make a specific dollar amount adjustment for
your nicely landscaped yard, it is taken into consideration in the overall condition and
quality of your home. Consider an easy-to-care-for layout and clean landscape design to
appeal to most buyers.

Number of Rooms

The number of bedrooms and bathrooms in your home may also impact the overall value of
the home. A home appraiser will compare your home to others in the area with the same,
or similar, number of bedrooms and bathrooms to make a value comparison.

Real Estate Market

The current status of the local real estate market has a great impact on the final appraisal
value of your home. If the market is saturated with buyers but there aren’t enough sellers,
home values will typically be on an upswing. On the other hand, an appraised value is
expected to be lower in the middle of a market that is saturated with many homes and
fewer buyers.

Recent Renovations

Recently renovated homes, especially those with upgraded kitchens and bathrooms, have a
major impact on the appraisal value of homes. Renovating these areas before putting your
home on the market is a great idea and can help realize a high return on investment. But, be
careful not to “over-improve” your home. Get advice from someone who knows your
neighborhood and what buyers expect. You may not want to put in that gourmet kitchen if you won’t get a return on your investment should you need to sell, because buyers aren’t
looking for that in your neighborhood.

Garage

An appraiser considers various factors when assessing a home’s garage (or lack thereof). This
includes:

If a garage exists
How many cars can fit

In general, where a home buyer is able to park their cars will influence the appraisal value.

Storage Space

A home with ample storage space such as closets, a basement, or a large attic is typically noticed by appraisers and may or may not impact value. Many home buyers are looking to upsize their home, including their storage space. Appraisers can consider this factor when determining a home’s value.

Heat & Air

The type of heat and air your home has is a factor in your home appraisal value. Central air
and heating results in a higher appraisal value than homes that require individual units in
each room. Outdated systems will also lower the appraisal value of your home.

Square Footage

Appraisers observe the square footage of homes. Once the total square feet number is
determined, an appraiser considers how the space is distributed throughout the home.
Appraisers will consider things such as:

How much square footage is useable
How much square footage is live-able space
How many stories your home has

Consider this list of factors prior to having your home appraised, in order to get the most
value. Additionally, consider strategically placing your home for sale during a time when the
market is filled with buyers. Check out the various things included in a Definitive Homes appraisal report here.

Definitive Valuations is North Alabama’s premiere appraisal firm. Our mission is to provide superior valuation and consulting services in Huntsville, Alabama, and surrounding areas. Our staff strives to understand your needs and to provide the best solution for your situation – whether for financial planning, relocation, tax dispute, legal matters, pre-listing, or any other purposes. Discover more here.

How Home Renovations Impact Appraisals

April 1, 2019/0 Comments/in Home Improvements and Value, Home Ownership /by Emilie Dover

There are pros and cons when it comes to home renovations. The biggest pro is that the
renovations improve your home and can make it more enjoyable for you. The major con is
that sometimes renovations can cost more than they are worth. When planning for home
renovations, it pays to plan carefully and make smart choices with return on investment in
mind.

Renovations that Impact Appraisal Value

Changing Your Color Scheme

Nearly two-thirds of real estate agents recommend repainting the inside of a home before putting it on the market, according to a 2017 survey by Houzz. Additionally, other studies show a fresh coat in the right shade can add thousands to your home’s sale price. Repainting can be one of the cheapest renovation projects, but it needs to be something neutral. Repainting with bright or other non-neutral colors can back-fire.

Incorporate Landscaping

A little lawn care can go a long way. Curb appeal is an important factor to a home appraisal.
Consider simple upkeep for your yard such as:

Mowing
Weed-eating
Gardening
Pressure washing the sidewalks

Don’t implement any over-the-top landscaping projects, such as elaborate designs,
fountains, or stone walkways. These projects won’t hold their value.

Implement Energy-Saving Methods

There are various methods you can implement to ensure your home is as energy efficient as
possible. The most important area to focus on is ensuring your home is fully insulated.
Taking this step can cut your heating bills by nearly 10 percent, according to the
Environmental Protection Agency.
Additionally, replacing old windows with energy-efficient ones can save you between $25
and $450 a year in heating and cooling costs. Other minor things include replacing simple
weather-striping at doors

Renovations That Have Little to No Impact on Home Appraisals

Many home renovations do not make financial sense. These are typically done from
emotions and not practicality and functionality. The following are renovations that
contribute the least value to a home:

Installing a pool
Converting a bedroom into a leisure space such as a playroom or wine cellar
Changing hardwood flooring to carpet
Closet renovation (adding shelves)
Adding bedrooms or bathrooms
High-end fixtures and finishes
Adding additional electrical outlets

Renovations can greatly impact the appraisal value of the property, either negatively or
positively. Consider what would contribute the most and the least value. It is important to
consider several other factors before implementing renovations.

Factors to Consider with Renovations

Location

A home’s location – what city it is in and even what part of that city – is key to this popular question. For example, adding a central air conditioner to a home in the South may add significant value, while putting one in a home near the Pacific Northwest may not have much impact.

Room

Which room are you considering making renovations to? According to one national survey,
kitchen remodels returned an average of 88 percent of the investment. In other words, a
$10,000 kitchen remodeling project would add approximately $8,800 to the value of the
home. Bathrooms were second, returning 85 percent.

Age

The actual age of a home is not what is most important when appraising a home. An
appraiser is more concerned with the effective age. According to The Appraiser Coach, if you
can take 10-15 years off the appearance of your home, you are doing yourself a huge favor.
The value of a home is determined by the buyer’s perspective.

How Green Home Improvements Can Affect Your Appraisal

March 1, 2019/0 Comments/in Home Improvements and Value /by Emilie Dover

Green home improvements are proving to be highly beneficial to home sellers and buyers.

According to The Appraisal Institute, the nation’s largest professional association of real estate appraisers, three recent studies confirm that green homes may sell for more than non-green properties. The Institute recently encouraged home sellers to consider making green home improvements to their properties, and encouraged buyers to seek homes with those features as well.

There are six elements that must be in place in order for a property officially be considered green:

Site
Water efficiency
Energy efficiency
Indoor air quality
Materials
Operations and maintenance

The green building trend is expected to continue to grow in the future. According to the National Association of Home Builders, the number of single-family builders with more than 90 percent of their projects dedicated to green building is expected to increase from 19 percent in 2017 to 31 percent by 2022.

Download the Appraisal Institute’s “Guide to the Residential Green and Energy Efficient Addendum” here.

The addendum states that, “An energy-efficient property is one that uses resource-effective design, materials, building systems, and site orientation to conserve nonrenewable funds.”

Check out these green home improvements you can easily implement that may improve your home’s value, as well as play your part in protecting the planet.

Solar Panels

Solar energy is the cleanest source of energy. Although expensive initially, you are bound to make your money back long-term with solar panel usage. Implementing solar panels in your home can bring down your energy consumption and supply excess energy. Additionally, government grants, incentives, and tax breaks are available to those who are interested in incorporating solar power in their home.

Permeable Block Caving

One of the latest green home improvements available is permeable block paving. This is a sustainable paving system used for driveways and patios. Permeable paving is similar to standard paving, but has larger gaps between paving blocks, allowing for movement of excess water through the surface, which can be collected and reused. This feature is better for the environment and for your home’s safety.

Insulation

On average, more than 50 percent of a home’s energy consumption goes toward heating and cooling. Ensure the rooms on the top level of your home are all insulated to decrease energy bills Consider speaking to your energy company about an audit if you are unsure of your needs.

LED Light

When it comes to lighting in your home, consider replacing all bulbs with energy-saving bulbs. LED and CFL bulbs use 80 percent less energy than standard bulbs, last longer, and produce the same strength of light.

Double-Glazed Windows

One of the key green home improvements one can make is replacing standard windows with double-glazing. These airtight windows insulate your home better than any other method and can even reduce noise pollution.

Green and energy efficient home improvements have the potential to pay dividends for buyers and sellers. If you are considering these green home improvements for your home, keep in mind that if you plan to finance your home or sell, the value may or may not be able to be proven in the market at that time, based on what recent sales activity has taken place.

Definitive Valuations is North Alabama’s premiere appraisal firm. Our mission is to provide superior valuation and consulting services in Huntsville, Alabama, and surrounding areas. Our staff strives to understand your needs and to provide the best solution for your situation – whether for financial planning, relocation, tax dispute, legal matters, pre-listing, or any other purposes. Discover more here.

Difference Between Appraisals and Inspections

Differences Between a Home Appraisal and a Home Inspection

February 18, 2019/0 Comments/in Home Ownership /by Emilie Dover

Home appraisals and home inspections are two very different things, but both are necessary in the home buying or selling process. Each of them are evaluating the home from two different perspectives. Additionally, the two are very different processes requiring separate skill sets and expertise.

What is an Appraisal?

The home appraisal is a form of evaluation in which the appraiser gives an opinion of the value of the property being considered. As an appraiser formulates an opinion of the value of your home, he or she will take the following into consideration during the process:

Location
Size and type of Lot
Overall Quality of Construction
Overall Condition
Prices of Comparable Properties

An appraiser isn’t interested in whether a house is clean, but he or she will notice signs of neglect, such as cracked walls or chipped paint. There are three types of approaches which guide the appraiser to build the valuation of the property.

Cost Approach

The cost approach is one approach that appraisers may consider while determining value, although it is important to note that cost does not necessarily equal value in the world of appraisal. Cost may be greater than, equal to, or less than the contributing value of that item/feature to the whole value of the property. The cost approach involves discerning what the improvements would cost minus physical depreciation, plus the land value.

Sales Comparison Approach

In the sales comparison approach, the appraiser carries out a detailed analysis of comparable sales within the subject’s defined market area. Preferably these properties will be located within close proximity to the property being appraised and will be reflective of the most recent sales. Although for specialty properties, an appraiser may be required to search further in distance and time to find something truly “comparable” to the property being appraised. This approach is the most accurate and clearest indicator of a likely sales price for a home since realtors in the market also look at other home sales in the market when assisting potential buyers and sellers in real estate transactions.

Income Approach

Lastly, the income approach is another option appraisers can rely on and is most valuable when appraising income producing properties (rental properties). This method involves estimating what an investor would pay based on the money produced by the property.

What is a Home Inspection?

A home inspection is an objective visual examination of the physical structure of a house, from its roof to the foundation. The home inspection involves comprehensive analysis of the structure, amenities, and other items to include:

HVAC Systems
Interior Electrical Systems
Sanitation / Plumbing
Roofing
Chimneys
Visible Insulation
Walls, Ceilings, Floors, Windows, and Doors

A home inspector will educate the buyer or seller on the condition of the home and its major components. The inspector also takes note of the cleanliness and physical condition of the house, looking for things such as cracks in the walls, broken windows, chipped paint, damaged floors, torn carpet, or damaged appliances.

The Differences

A home inspection will always involve a professional visiting a property and conducting a physical exam. Often an appraisal will often involve a visit to the property by a professional appraiser. However, it is important to note that an appraiser may also be able to give an opinion of value without visiting the property at all as long as enough information is available to make some assumptions and complete the assignment. Additionally, both home inspections and appraisals will often occur prior to the closing of the sale of a home and will result in a report regarding the property’s state, functionality, and integrity. Both are also meant to be unbiased looks at the piece of real estate. However, the two also have big differences, as they both complete different tasks.

Ultimate Goal

A real estate appraiser’s key job is to provide their opinion of the value of the home to the lender, buyer, and/or seller. On the other hand, a home inspector guides the buyer about the physical components and the detailed condition of the home.

Duration

A home inspectors inspection can last two to three hours, while an average appraisal inspection involves a simple walk-through. The appraiser’s job is not finished and did not start at the property inspection, but involves detailed research, analysis, and reporting of the market activity and sales in the area and how they compare to the property being appraised.

Details

An inspection assesses the physical components of a home. An appraisal considers a multitude of features of the home including: the location of the home, the school district the home is zoned for, the size of the home, its overall quality and its overall condition.

Both appraisals and inspections are important in protecting a real estate investment. An inspection can safeguard you from making any costly mistakes, such as purchasing a home with a faulty foundation. An appraisal gives you an unbiased, accurate value of the property. Be sure to have both processes taken care of before making any next steps in buying or selling property.

Definitive Valuations is North Alabama’s premiere appraisal firm. Our mission is to provide superior valuation and consulting services in Huntsville, Alabama, and surrounding areas. Our staff strives to understand your needs and to provide the best solution for your situation – whether for financial planning, relocation, tax dispute, legal matters, pre-listing, or any other purposes. Discover more here.

4 Tips to Increase Your Kitchen’s Value

January 10, 2019/0 Comments/in Home Improvements and Value /by Emilie Dover

When looking to increase your home’s value, the best place to start is the kitchen. According to the Appraisal Institute of Canada, each year, kitchen renovation projects record the highest return on investment. Statistics show that 75 to 100 percent of kitchen expenditures are recovered when the home is sold.

Consider the following tips when looking to increase the value of your kitchen.

Do the Research.

Ask a local real estate agent about kitchen necessities in your specific neighborhood and surrounding areas. Research what attracts buyers and what repels them. Because you need to realize a nice Return on Investment (ROI) on your kitchen once it is time to put your home on the market or to receive an appraisal, you must set priorities based on what sells a kitchen.

Simplicity is Key.

One of the most important things to remember when remodeling your kitchen is to choose materials and designs that appeal to the masses. The style and color scheme of your kitchen should be simple and classic. Although bold colors and texture may be on trend, the lifespan of these themes are often short-lived.

Consider Consistency.

Additionally, it is important that you never compromise the architecture of your home. If the exterior of your home is traditional, a contemporary kitchen would not transition well for most buyers.

Avoid Luxurious Accessories.

When selecting materials and appliances for your kitchen, keep your budget in mind. If cabinets are outdated, it may only require new hardware to refresh the look. Steer clear of exotic designs and appliances, and be sure to ask yourself if what you are considering is a necessity for the kitchen or simply a luxury. Don’t select cheap materials and products, but also avoid the highest end items and features.

Kitchen Features to Focus On

Countertops

Natural stone or quartz countertops are safe selections for increased kitchen value. It is important to never compromise on quality when it comes to your kitchen’s countertops. Select colors and patterns that complement your cabinets and wall colors.

Accessories

When it it comes to your kitchen, functionality, space, and convenience are important factors homebuyers consider. Implement smart accessories such as pull-out pantries, extra drawers, or corner shelving.

Lighting

A small change in lighting can change the entire look of your kitchen, enhancing the appeal and ambiance of the room. Additionally, under-cabinet lights can illuminate the workspace countertops. A vintage-style chandelier will give a classic feel to your cooking area.

Appliances

Replacing all of your kitchen appliances is highly expensive. A more cost-friendly alternative is giving them a facelift. Order new doors or face panels for a cohesive look. Stainless steel skin covers are available for refrigerators, microwaves, dishwashers, and other kitchen appliances. Use these to upgrade the look of your kitchen.

Walls

One of the simplest ways to increase the value of your kitchen is by painting or refinishing the walls. Consider bright, inviting colors such as white, ivory, or gray. Color accents can easily be tied in with accessories and appliances. Be mindful of personal color preferences, as they could be a deterrent to prospective buyers.

A kitchen backsplash is the focal point of the room. Select an eye-catching backsplash with materials such as wood, metal, glass, or ceramic tile to add texture to the area.

As a general rule, keep the overall cost of kitchen renovations under 15% of the home’s value in order to receive the maximum return on investment. Minor updates can add immediate value to your kitchen. If you are getting ready to sell or receive a home appraisal, consider these simple changes.

Definitive Valuations is North Alabama’s premiere appraisal firm. Our mission is to provide superior valuation and consulting services in Huntsville, Alabama, and surrounding areas. Our staff strives to understand your needs and to provide the best solution for your situation – whether for financial planning, relocation, tax dispute, legal matters, pre-listing, or any other purposes. Discover more here.