Showing posts from February, 2015

How the Appraisal Works in the Home Buying Process

Are you thinking about buying or selling a home?  Are you in the process? This is written for those who are buying or selling a home and want to know the role of the appraisal in the home buying process.   Unless someone is able to pay cash for their home most home purchases involve a  loan from a lending institution.  Lenders require an appraisal of the property. Here are some things to understand about the appraisal:

1. What is an Appraisal?
The Appraisal Institute defines an appraisal as:

An appraisal is a professional appraiser’s opinion of value. The preparation of an appraisal involves research into appropriate market areas; the assembly and analysis of information pertinent to a property; and the knowledge, experience, and professional judgment of the appraiser. . Appraisals may be required for any type of property, including single-family homes, apartment buildings and condominiums, office buildings, shopping centers, industrial sites, and farms. (here is the link)

The appraiser …

External Influence of Rail Road Tracks on Real Estate

Are you considering buying a home that is located near rail road tracks?  Do you live by rail road tracks?  Does this affect the value of your home?

When appraising real estate location is always a factor that is considered.  If a property is located next to an active rail road track this would be an external factor and its impact would need to be considered when valuing a property.  Would it be considered an external obsolescence?

The Dictionary of Real Estate Appraisal defines "external obsolescence" as an element of depreciation; a defect, usually incurable, cased by negative influences outside a site and generally incurable on the part of the owner, landlord or tenant. 

A rail road track would be considered an outside influence that is not curable by the owner, landlord or tenant. Most buyers would be willing to pay  more for a house not located near the sound of the train horn roaring by at all hours day and night.   So how does an appraiser determine the effect of the …