There’s no question that real estate Investors and Agents need to be surrounded by great teams and specific knowledge to be successful. Many industry experts start building their real estate investing teams with a few key players. Then, as portfolios and clients grow and diversify, it becomes important to add more critical resources to your real estate investing community for ongoing success.
Real estate appraisers are essential for any Investor or Agent working with Investor clients. The property investing experts at Privy talk about why partnering with a trustworthy appraiser is crucial for long-term success.
An appraiser can help you determine a property’s “true” condition— separate from a seller’s description in a real estate listing. With an appraisal, a real estate Investor and their Agent get an unbiased third party opinion about a property to help make informed decisions before closing. Without an appraisal on every property, Investors risk buying properties that require too much rehab to generate a profit on fix and flip investments or long-term buy and hold rental properties. In addition, a qualified appraiser helps investors make good offers on properties while reducing the potential of overpaying for a residential investment where a sale price is much higher than the reasonable value of the home.
What are the Benefits of Adding an Appraiser To Your Real Estate Investment Team?
Analyzing the Exterior Condition of a Property
Qualified appraisers analyze the exterior condition of a property compared to the seller’s description. This can help Investors and Agents understand if a property needs significant repairs to external structures, like patios, decks, pools, or foundations.
Reviewing Interior Property Conditions
Your appraiser also assesses the interior condition of potential investment properties with a room-by-room walkthrough. They evaluate amenities such as a finished basement, square footage, and the ages of systems and appliances. They can also look for safety or health code violations that could be warning signs of a bad rental property investment before moving forward with the purchase of a new investment property.
Providing Insights into Market Conditions
Appraisers can provide valuable insight into the real estate market. They can give you an idea of what similar properties in the area have sold for, the current market conditions, and even what to expect when it comes to future real estate market changes.
Reducing the Risk of Fraud
Real estate appraisers can help reduce the risk of fraud in real estate investing. By providing an unbiased opinion on a property, Agents and Investors can be sure they’re making informed decisions about the potential for their investments in real estate assets.
Expediting Funding for Real Estate Investing
Many Lenders require a satisfactory report from a qualified appraiser before approving financing for real estate investments. With an appraiser on your team and readily available, you can deliver a report to your Lender without delay.
What Can You Expect from an Appraiser?
When real estate Agents and Investors partner with a qualified and experienced appraiser, they can expect the following:
- Detailed analysis of a property’s exterior and interior features
- An objective market valuation of the property
- Insight into real estate market trends
- A report accepted by most lenders
An appraiser’s report usually includes a street map showing the location of the property, photos of the interior and exterior, explanations regarding calculating square footage, building sketches, and other relevant information used to calculate the property’s value.
How To Find an Appraiser
When searching for the ideal appraiser, make sure they understand the types of properties you prefer. For example, hiring an appraising expert who focuses on condos for long-term rentals might not be ideal for you if you prefer investing in single-family homes as fix and flip opportunities.
Investors and real estate Agents should work together to find trusted appraisers. In some cases, you might need multiple appraisers when investing in different markets. Appraisers should understand specific market conditions and factors that influence residential property values.
Make sure your appraiser has the appropriate licenses and certifications to provide legitimate reports accepted by lenders. Lastly, ask about pricing and ensure that your preferred appraiser’s fees fit within your budget.