percentage of the assessed value determined by a professional. From legal descriptions to onsite inspections to comparable home-selling prices, the assessor will take all these things into consideration when assessing a home. Location near industry, high traffic, or potential development will also affect the appraisal.
Nothing determines the sale price of a piece of real estate but the price at which it sells. Houses are not same-priced identical cans of tuna on the grocery store shelf or shares of stock valued and traded every day on the stock exchange. A real estate appraisal (“property valuation”) is the process of developing a perspective of value for real property. This is the market value — i.e., what a willing reasonable buyer would pay for the property to a willing reasonable seller. Real estate lenders generally require an appraisal because every real property is unique in features and characteristics. An appraisal helps in various decision points. The seller can use the appraisal as a basis for pricing. The buyer can use it as a gauge on which to base an offer. Lenders use appraisals to know how much money to credit to their borrowers.
The important factors in a house appraisal are:
• Dwelling type (e.g., one-story, two-story, split-level, factory-built) • Features (including design) — materials used and the kind of structure present and how they were built • Improvements made • Comparable sales • Location — type of neighborhood, zoning areas, proximity to other establishments 7
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