If you are buying a home, getting a home appraisal is a wise decision. The appraiser will evaluate how much the house is worth based on other comparable properties in the area, and adding in extra features that create value. Home buyers use the appraisal to determine if the pricing on the house is fair and reasonable. Sellers often have an appraisal done to make certain they have the correct pricing for their home.
A home appraisal costs on average $375-$450, with the average homeowner spending around $400 for a single family, 1,300-1,700 square foot home with a few upgrades and small property. Keep in mind there are several factors that can increase the pricing such as the size of the property, the number of home appraisers available, or if it is a high-end home where a ‘jumbo loan’ is required.
House Appraisal Cost | |
---|---|
National Average Cost | $400 |
Average Range | $375-$450 |
Minimum Cost | $300 |
Maximum Cost | $1,000 |
While there are several factors that contribute to the appraisal fee, the type of property you are buying impacts the house appraisal cost. Many times smaller properties equate to a lower price for the appraisal. Keep in mind that there are other components as well but size is a larger part of the fee.
Type of Property | Cost of Appraisal Fee |
---|---|
Land | $300-$500 |
Mobile Home | $300-$775 |
Condo | $375-$450 |
Single Family Home | $375-$450 |
Multi-family Home | $400-$800 |
Estate Appraisal | $400-$1,000 |
Ranch | $600-$1,000 |
Land appraisals are generally priced lower as there is less work to evaluate the property - no home to walk through. Much of what the appraiser will need to evaluate is done through research on surrounding properties. Land appraisal cost runs $300-$500.
Mobile homes are also known as manufactured homes as they are built in a factory and then moved via truck to a lot or property. As many people who have mobile homes also have land surrounding the home, the cost varies for the appraisal at $300-$775.
It would seem that condo appraisal cost would be less expensive than a single family home. However, that is typically not the case as condos have to have the entire building value accessed and then each condo individually. Expect to pay $375-$450 for condo appraisal.
A single family home is simply a home that is meant to house one family only as opposed to a multi-family home which would be a duplex or condo. Most residential neighborhoods consist of single family homes. The cost for a single family home appraisal is $375-$450.
Multi-family homes are buildings that provide housing for 2 or more families. These would generally be townhomes or duplexes. A multifamily home appraisal cost is $400-$800.
An estate appraisal is normally done after the death of the owner or in a divorce situation to access the value of the home and its contents. The figure that is reached helps to determine the taxes due on the property as well as how to divide the estate equitably. Cost for an estate appraisal may start as low as $400-$1,000, depending on the extent of the contents.
As a ranch consists of acres of land, the appraisal is typically more expensive. The pricing could also include the purchase of livestock and farm equipment. A ranch appraisal cost $600-$1,000.
Home appraisal fees are often charged according to home size. It makes sense that if there is more square footage to appraise, the appraiser would charge more. He/she would need to measure and consider any upgrades in each room. In addition, a larger home often has more expensive such as granite, hardwood floors, marble tubs, etc. These upgrades take more time to add to the value.
Home Size | Appraisal Cost |
---|---|
1,200 sq.ft | $200 |
1,400 sq.ft | $350 |
1,700 sq.ft | $450 |
2,000 sq.ft. | $600 |
2,500 sq.ft. | $800 |
A property appraisal is always done by a third-party impartial individual. If the lender is ordering the appraisal, they choose who will do the appraisal. Before the appraisal or any other money is spent, the lender will provide the buyer with a loan estimate and closing disclosure so that all upfront and closing fees will be known ahead of time.
Lender | Cost |
---|---|
Private | $375-$450 |
Bank | $375-$450 |
FHA | $375-$700 |
VA | $450-$1,200 |
A private appraisal is simply one that is done by the buyer or the seller, independent of the appraisal ordered by the lender. This type of appraisal can be completed by your choice of appraisers but be aware it may not be used by the lender. Oftentimes, a buyer or seller want to have a second opinion on the value of the home and in this case will pay for a private appraisal at a cost of $375-$450.
If you are financing your home through a bank, there will be a charge for a bank appraisal. This may be in your closing costs or you may be required to pay prior to closing. Bank appraisals are done by a licensed appraiser, typically drawn from a list used frequently by the bank. Cost for a bank appraisal is generally based on size, type of property, and upgrades. An average cost is the same as a private appraisal at $375-$450.
FHA has its own separate home appraisal checklist for approval. Basically, FHA wants to know that the home they are financing will be safe and that it is a secure investment. In order for a home to be financed by FHA, it must meet the guidelines set by the Department of Housing and Urban Development, or HUD. As is the case with other types of lending, the appraisal is priced according to size, type of property, location, and upgrades, typically at a cost of $375-$700. While FHA does not set forth required pricing, it must see the costs as reasonable and customary for the housing market in that area.
Although the average cost of an appraisal is pretty much the same across the board, VA appraisals are governed by the VA. This means that costs cannot rise above a certain level that varies from state to state, $450-$1200. This is also decided by the type of the property. For instance, in Florida, a single family home appraisal cannot cost more than $500 and the report must be completed within 7 days. In Montana, a manufactured home appraisal cost cannot exceed $825 and turnaround time is 14 days. To see your state’s information, check out this map for VA appraisals.
The value of your home will be directly influenced by how the home looks. Here are some things to do before the appraiser comes:
As a seller, you will want to know the value of your home to make certain you get top dollar when you put it on the market. As a buyer, you will want to make certain the home you are buying is worth the same or more than what you are paying. A home appraisal will help to clarify both of these situations. In addition, the lender usually requires a home appraisal to ascertain that the home is worth the asking price.
Your home appraisal report will include a full description of the property. This will note the condition of the home and property, neighborhood growth and value, obvious repairs needed, the names on the title, and the overall square footage as well as the size of each room. Any upgrades or improvements will be added into the value. Also included will be market information based on surrounding areas. Other information would include proximity to lakes, rivers, easements or encroachments, zoning classifications, and utility services available. Typical cost for an appraisal report is $375-$450, which is already included in the overall appraisal fee.
Often an initial appraisal is done on a new home before it is completed. In this case, the buyer or seller will pay for an appraisal final inspection fee of $150-$175 to ensure that all work has been completed and is up to code. In situations where renovations are done with a reinspection to include completed projects in the home value portion, a buyer or seller may need to pay an appraisal reinspection fee for $150-$175.
Although size does affect the home appraisal cost, there are several other factors as well. Factors include:
Obtaining an appraisal is always a wise decision both for the seller and the buyer. Sellers want to make sure they price the home so they get the maximum amount possible while buyers want to ascertain they aren’t paying too much for a home.
Mortgage companies as lenders are focused on only lending an amount that is equal to the value of the home or less. Because this is key to running a profitable lending business, a mortgage company will always require an appraisal. A typical mortgage appraisal fee is $375-$450.
For a refinance, the mortgage company will often require a new appraisal for the same reasons as a new purchase - to make certain the home is worth the same or more than they are lending you. A home appraisal for refinance will cost $375-$450.
The cost for the home appraisal is a negotiable closing cost. If the seller is particularly anxious to sell, he/she may volunteer to pay this fee. On the other hand, if the buyer is very motivated he/she may be the paying party. Certain states may have requirements for the amount or the category a buyer or seller is allowed to pay for in closing costs. Your real estate agent or mortgage company will be able to help you determine who should pay for the appraisal.
If you are listing your home through a real estate agent, typically the price you have on the home is fairly on point. However, that is not always the case and you may get an appraisal lower than purchase price. If this happens, the homeowner can write a letter and ask for an appeal. Keep in mind that this will only work if there is proof that the original appraisal was incorrect. An example would be if the appraiser didn’t realize you had put a new roof on the house or that your neighborhood had an amenity center with a pool. These types of situations are the stuff of nightmares for buyers and sellers alike. If you are desperate to sell and the report comes back with a house appraisal lower than offer, you can always offer to pay more closing costs.
What negatively affects home appraisal? A crowded or extremely dirty home will influence the appraisal value of your home. Any repairs that have been left undone will also lower your home’s value. If you have neighbors whose yard or house looks unkempt, this will affect the appraisal amount as well. Broken concrete, peeling paint, rotting boards, debris, and other signs of neglect will bring a lower price point.
Adding fresh mulch 1, paint, cutting the yard, trimming bushes and edging the grass, pressure washing the sidewalk and driveway are all ways to add curb appeal to your home. Inside, do away with clutter, clean up areas of mold, mildew, or dust. Clean or paint baseboards, make necessary repairs, straighten closets, cabinets, and remove items from bathroom/kitchen counters. Shampoo carpets, mop floors, clean the windows and doors, bathrooms, and kitchen area. Keep furniture to a minimum to make your home look larger.
The home appraiser may take as little as 30 minutes or several hours to complete the inspection part of the process, depending on the size of the home, property, upgrades, and how accessible all of the areas of the home are. Then he/she has to do the research and calculating necessary to come up with an accurate analysis. It can take 3-10 days to get your appraisal done.
Although the outcome of the real estate appraisal is always to come up with a fair value, the approach used is often different based on the type of property. Whether comparing an existing home, a new home, or an income-producing property, the appraisal method varies and real estate agents/appraisers will choose the right method for each individual situation.
The Real Estate Sales Comparison Approach is used to compare apples to apples - in other words, finding homes just like yours within your neighborhood to compare recent sales. Once a comparison is done, any upgrades should be added to the value determined.
The Real Estate Cost Approach method is used more effectively on new homes. The appraiser will add the value of the vacant property to the current cost of building the home. Depreciation will be subtracted but with a new home, there is no depreciation.
The Income Approach Appraisal is generally used for income-producing properties, like a rental house. In this situation, an investor wants to take into account any repairs or renovations that may need to be done.
A home inspection is different from a home appraisal. While the home appraiser is looking for items that add or take away value, the home inspector is looking for problems. While some lenders require a home inspection, others may not. Buyers should always have a home inspection done prior to buying a home as there are no guarantees the home is sound. The inspector is looking for repairs that need to be done such as HVAC systems problems, roof, plumbing, or electricity issues, leaks in windows and doors, structural and foundational issues, cracks, infestations, mold, mildew, appliances that will soon need replacing or aren’t in working order. Once the inspection is done, the buyer can approach the seller with a list of items to fix. The buyer has the option of performing the necessary tasks or losing the buyer. Cost for a home inspection is $275-$400 versus the average cost of a home appraisal at $375-$450.
There are several reasons why an appraisal may come back lower than the asking price. If you are sure your pricing is correct, you can appeal the appraisal if you feel the comparisons used were inaccurate. This could be due to the appraiser missing such items as upgrades, renovations or neighborhood amenities. You can also look at the sold home comparisons to make sure these are like homes sold recently.
Obviously, adding upgrades or doing renovations will help to increase the appraised value of your home when you are refinancing. Making sure the home is clean, well-organized and free of clutter will also help. Repairing any major issues can increase the appraised value as well.
The appraisal is one of the first tasks ordered when purchasing a home. Your lender will want to know immediately if the home is priced accurately to avoid spending time on a file that won’t ever close.
There are many online tools to get a somewhat accurate appraisal value on your home. Zillow is perhaps the most popular but your real estate agent can help as well. Most real estate agents will do a free market analysis to give you a good idea of your home’s value.
There are three situations where the lender may order a second appraisal. If it has been 3-6 months since the original appraisal, the lender will order a second appraisal to ensure no changes have occurred. This often happens when the home being purchased is a foreclosure home. The second reason is based on the type of loan the buyer is getting. Some loans require a second appraisal. Thirdly, it could be that the seller is unhappy with the original appraisal and has requested a new one.
The home appraiser is measuring rooms, looking for upgrades or renovations, repairs that need to be done, the layout of the home, and the property around the home. He/she will also take comparable homes near you for an average sales price.
There are many online tools for free home appraisals. However, keep in mind, that a free appraisal is merely a snapshot for your own use. If you are purchasing or refinancing a home, a licensed appraiser will need to do the appraisal and the typical cost is $375-$450.
Cost to hire a home appraiser varies greatly by region (and even by zip code). To get free estimates from local contractors, please indicate yours.