All of this means that property values are rising dramatically and homes are being valued more now. However, geographic location and other considerations will also affect home appraisals in the area where you live. Today's market has a significant increase in property values. The average increase in home appraisals in Texas is 25% according to the Texas Appraisal Districts Association.
No matter where you are in the homebuying process, an appraisal can help you buy your future home at the right market value. A purchase appraisal can also affect both the cost of selling and the amount of the mortgage. You should also know what trends are currently happening to get an idea of how homes are being evaluated in this market. Fortunately for the homebuyer, there's no guarantee that a buyer after you won't end up with another low appraisal.
The appraiser works for the lender and most lenders have a third-party service from which they request and schedule the appraisal. But if you think you have strong arguments that the home can generate value, it might be worthwhile for the buyer to conduct a new appraisal. Because appraisers base their valuation on comparable sales, they may struggle to justify a sale price that is higher than that of similar homes sold recently. The appraiser reaches this number by looking at similar homes that have been recently sold and details about the property.
If you think you have good management of home appraisals and how they can affect sales prices and loan amounts, you may be wondering what your next steps are. Unlike the sale price, the appraised value of the home may not be what sellers ask for their home. If the buyer included an appraisal contingency in their offer, they can exit the deal with the bond intact if the valuation falls below the contract price. While some argue that you should never pay more for a home than it's worth, it's important to remember that appraisals are merely opinions of value.
An appraisal is the best way to estimate the fair market value of your property based on the location, status, and recent sales of similar homes in the surrounding area. Geographic location and what the area offers access to is one of the first things a good appraiser will consider when calculating a home. But if you work with your agent to provide evidence of errors in the appraisal and the lender believes that your request is well supported, you may ask the appraiser to review it again.