Anytime a house sells to a buyer who is financing their purchase, the lender will require a third-party appraisal to verify the value of the property and determine what they’re willing to lend. As a separate matter, sellers also have the option to get their own pre-listing appraisal for the purposes of setting an asking price. That begs the question: Should I get an appraisal before selling my house?
Normally, a top real estate agent’s CMA (comparative market analysis) is all you need to gauge what a buyer is likely to pay for your home, saving sellers the $500-$600 extra expense of ordering an appraisal. And you can always get a free online home value estimate as a starting point. However, certain scenarios may justify obtaining a pre-listing appraisal. In this guide, we cover what those special circumstances may be so you can make an informed decision.
Surplus or excess land is another issue that may make it more difficult for a homeowner to have a good gauge of a property’s value.
“When analyzing extra land or acreage, an appraiser must consider the size, zoning, and potential uses for that land to develop a credible opinion of its value,” says John Brenan, chief appraiser at Clear Capital, a national real estate valuation and analytics firm headquartered in Reno, Nevada.
“For example,” he adds, “if a property has additional land but that land is located in a flood zone where it’s not possible to build any improvements, that would be substantially different than extra land that could possibly be sold separately from the primary property.”