Appraising a home is a common procedure in the real estate market sector. The appraisal is nothing more than a report that evaluates the characteristics of a home as a whole and establishes an assessment, which will serve as a reference to determine a possible sale price. Of course, each asks what he wants for his goods, but that value gives a objective idea of how much you can get for the sale of your house, taking into account supply and demand existing along with other parameters.
There is also a second case in which this document will be essential for you. If you are going to buy, applying for a mortgage, the bank will demand to know the value of that asset that you are going to put as collateral, so the property will have to be appraised. The mortgage credit will be a percentage of appraised value.
How is a home priced?
The Bank of Spain (@Bank of Spain) explains what the appraisal societies, entities approved and supervised by himself, those in charge of carrying them out. You can request this report or make it a bank, an insurance company or any other entity interested in knowing the value of a real estate, including public bodies.
Appraisers are professionals with specific training in order to make these assessments as accurately and objectively as possible. Generally, they are architects and technical architects, although it may also be an engineer or industrial or agricultural technician if, for example, you want to value a land or an industrial warehouse.
The step prior to the visual inspection that the appraisal requires is the request for a simple note in the Property registration, which allows to contrast the basic data of the property such as its exact location, its use, the registered square meters, the ownership of the property, etc. The professional will also compare the data with those that appear in the cadastre. In addition, a study will be carried out on the situation of the real estate market in the area in which the house is located, as a first step to know the level of supply and demand, and the average price per square meter.
The appraiser’s visit
It is the key moment because there are several factors that the professional will check on site. During the review, you will fill in the various headings that you need to include to prepare your final report. Among the main parameters The ones you are going to look at include:
- General condition of the property. Logically, you will take into account the age of the house and its state of conservation. A practically new house is not the same as one built decades ago that has not been renovated.
- Square meters and distribution. Although the available space is already reflected in the simple note, the appraiser will detail how those meters are distributed. Those in a long and not very useful corridor do not compute the same as those in bedrooms or living room. Nor are those of patios, terraces, etc. Any space that does not appear in writing, such as a basement that you have enabled as part of the house or a loft in the same case, will not be valued the same as the “legal” ones.
- Orientation and isolation. Depending on the geographical area where the property is located, a north or south orientation will influence whether it is worth more or less, because it will make it more or less hot or cold. In this sense, the state of the enclosures and energy efficiency are also important elements. That a floor has enough light natural, that is, it is exterior and with good windows is also a plus.
- Building status. Its age is taken into account and, if it is more than 50 years old, it has passed the Technical Building Inspection (ITE). A construction that shows deterioration will detract from your home even if it is impeccable.
- Other details. They are very varied because an appraisal is not just “math”. The professional will take into account any element that adds value to your home. That it is in a well-connected area and with all services, in an urbanization with gardens and swimming pool, that has a garage, that offers beautiful views … everything adds or subtracts.
In case of mortgage, who pays it?
There are several doubts that arise when the appraisal is required as a previous step to the granting of a mortgage loan. Usually, it is the bank who orders it, always in agreement with your client. Even so, since 2007, the Law establishes that the entity must accept the appraisal that a consumer can provide as long as it is certified by an approved appraiser and is not expired (its validity is six months).
Payment for the completion of this report corresponds to future buyers of the house. In this sense, it is recommended that the appraisal be carried out when the bank has made a first study that is, in principle, favorable to the granting of the mortgage. Keep in mind that if they finally do not give it to you, you will have to assume anyway the cost of the appraisal, an aspect on which the entity must inform you previously and conveniently.