Short Course on Options – What You Need To Know
Real estate appraisal refers to the opinion on the value of a real estate property by an appraiser. Because of the uniqueness of every real property, it is very important to seek for the services of a real estate appraiser to give you their opinion on the market value of the property before signing any buy agreement. It can be frustrating for you to make a down payment on a certain property only for the appraiser to tell you that the property’s worthy is less than what you had agreed upon to pay.
Unlike other properties which are frequently traded, real property transactions are infrequent. There are numerous factors that might impact the price of real estate property. Some of the factors are unique to each property while others are same across most properties. These variables include; location, neighborhood, market, age, condition, amongst others.
To most people, location is the most important consideration when buying real estate property. Location per se doesn’t mean the actual place where the property is situated but is determined by other micro-factors such as proximity to various amenities. You might find that real estate properties situated in areas that have access to various amenities are valued higher than those properties whose access to such amenities is limited. For example, properties situated in areas with access to local quality learning institutions may attract many buyers with school going children and this will increase demand for such properties consequently their market values may be higher. Likewise places with proximity to local employment opportunities may attract higher prices.
The surrounding neighborhood also plays a key role in determining the value of any real property. If the house is located in wealthy neighborhood, then its value might be higher. Also the market demand of real estate property will determine its value. Whether there are lots of prospective buyers with interest in a particular real estate, then its value might be greater compared to one with few potential buyers. In real estate appraisal, there are various sorts of value that an appraiser appears at. These include; market value, value-in-use, investment value, liquidation value and insurable value.
Market value off real estate property is the cost at which such land (property) can exchange at a competitive property market. In simple terms, market value is the estimated amount a liability or asset can be exchanged on a particular valuation date between a willing seller and willing buyer. Value in use on the other hand refers to the amount of money a property can create for the proprietor for a specific use. On the other hand, investment value is the value of a property to a particular investor for a particular investment. Insurable value of a property is its value which is covered by an insurance policy and does not generally consist of site worth.
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