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Getting home appraised.

Elliott

Elite Member
Joined
Apr 23, 2002
Professional Status
Certified General Appraiser
State
Oregon
1. Get a home inspection, including a pest report.
2. Get an appraisal on the property where you are the client. Give the appraiser the home inspection and pest report.
3. Negotiate with the estate. You can tell the estate that they won't have to pay a real estate commission and the estate would normally have to pay that amount, so there could be
a price concession for the amount of the normal real estate commission.
 

Webbed Feet

Elite Member
Joined
Feb 11, 2005
Professional Status
Certified Residential Appraiser
State
Canada
My girlfriend and I are going to buy a house that is in a trust that was left to her and her siblings in California. The oldest one is having it appraised, there were termites in one of the bedroom in the subfloor but there is also evidence that they might be in 3 of the walls, 2 outside walls and one inside wall since there are holes in the sheet rock with the termite tunnels at the holes. How would the appraiser list or report this?
We don’t have the report yet since he was just here yesterday for maybe 9 minutes max. But I explained to him about the damage since I want it noted so the price reflects that since I’ll be doing the work myself since I’m a contractor but he kind of blew me off. All he did was measure the outside of the house and took one picture of each room from the hallway, he didn’t even walk into the rooms.
Hi.... Stop and consider, you are a contractor, if you had to pay you local standard contractor prices for the repairs do you know what costs are going to be involved for repairs? Nope, you don't. Because no one will know until those walls get opened up, and even then contractor bids would be all over the place... right? So why are you expecting a real estate appraiser to know in order to reflect all this unknown in a value opinion? Most all intelligent appraisers would value the property as if there were no hidden pest problems and, now that you've slapped the appraiser in the face with it, use a "condition" that no damage exists and if it does their value conclusion is "subject to" it all being repaired. No intelligent appraiser would do anything else lacking comprehensive damage reports and repair bids. And, if I was asked to appraise the property with comprehensive reports... I'd charge at least double a standard appraisal fee for all of the related work needed. Opining value of a damaged house is much more involved than assuming no damage exists to arrive at a credible value opinion of an undamaged house.

Your situation, heirs negotiating with heirs over real estate, is one of the most hazardous situations for a real estate appraiser to deal with. The bottom line is one heir wants a low value and the others a high value. It is a no win situation for the appraiser and one that I've seen pretty much destroy family relationships over. Highly likely to leave an appraiser as the fall person with complaints filed against them. Making my point for me, to an appraiser, you blatantly attempted to influence the outcome of the appraisal analysis. And, I think you did so out of ear shot of the other heirs. I'm sure it seemed innocent enough to you, but not to an appraiser.

Appraisal reports are nothing more but the opinion of one person based upon their interpretation of their market research. What that means is several appraisers could conclude opinions many thousands of dollars different from one another. It is far, very far, from any sort of perfect science. Therefore, all the heirs basing negotiations, or worse absolute final pricing, based upon just one appraisal report is a bad idea from the get go. I hope you all have very strong family relationships and many heirs don't care much about how much money they get. If NOT.... the estate should repair and sell the property on the open market to avoid what will certainly be serious family fall out.

Just my opinion.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
My girlfriend and I are going to buy a house that is in a trust that was left to her and her siblings in California. The oldest one is having it appraised, there were termites in one of the bedroom in the subfloor but there is also evidence that they might be in 3 of the walls, 2 outside walls and one inside wall since there are holes in the sheet rock with the termite tunnels at the holes. How would the appraiser list or report this?
We don’t have the report yet since he was just here yesterday for maybe 9 minutes max. But I explained to him about the damage since I want it noted so the price reflects that since I’ll be doing the work myself since I’m a contractor but he kind of blew me off. All he did was measure the outside of the house and took one picture of each room from the hallway, he didn’t even walk into the rooms.
Her sibling is having it appraised, and her appraiser/appraisal may or may not be a well researched/developed report...a lot depends on comps sold in area and overall condition and upgrades of a home, termite issues aside. As a contractor, you have a pretty good idea of what it takes to mitigate a place if there is some termite damage, and it has to be relative to rest of condition

You and your GF (esp her, she is the heir, correct, ? ) need to get an appraisal done. Maybe each sibling will get their own appraisal done and it will turn into a real mess.

My advice ( as a person, not just as an appraiser, ) is your GF/you should not try to under-buy the house and take advantage, keeping family intact and good relations is worth more than $ ( unless they are trying to cheat you....) ...estate sales can get very contentious and deep seated family feuds surface....if that happens, nobody wins, the lawyers get all the money, some stupid settlement is reached where nobody is happy. So settle for a decent and agreed on price for the place, her "discount" will be her inherited share.

If you guys are trying to make $ flipping this place look for another property. (imo)
 

glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
Her sibling is having it appraised, and her appraiser/appraisal may or may not be a well researched/developed report...a lot depends on comps sold in area and overall condition and upgrades of a home, termite issues aside. As a contractor, you have a pretty good idea of what it takes to mitigate a place if there is some termite damage, and it has to be relative to rest of condition

You and your GF (esp her, she is the heir, correct, ? ) need to get an appraisal done. Maybe each sibling will get their own appraisal done and it will turn into a real mess.

My advice ( as a person, not just as an appraiser, ) is your GF/you should not try to under-buy the house and take advantage, keeping family intact and good relations is worth more than $ ( unless they are trying to cheat you....) ...estate sales can get very contentious and deep seated family feuds surface....if that happens, nobody wins, the lawyers get all the money, some stupid settlement is reached where nobody is happy. So settle for a decent and agreed on price for the place, her "discount" will be her inherited share.

If you guys are trying to make $ flipping this place look for another property. (imo)
Now JG we are appraisers and from experience dealing with family members even if each sibling got their own appraisal, that would even cause more confusion because you have fear and greed. One fears he/she is getting a low one and the one buying thinks the high one is too much. My recommendation is never buy a property unless its below market and just tell the relatives the truth and that you are not in the business of running a charity and you believe in buying low and selling high. Bottom line is no matter what you do its almost impossible to please relatives and that's why my rule number one is do not deal with friends or relatives period. I can choose my friends but I cannot choose my relatives. In this situation is if they are buying it to flipp then in order to make a profit any appraisal will be too high.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
A couple of RE sales people opinions would not hurt either...what they think they can sell it for

Imo the estate as a group should pay for a home inspection and termite inspection so everybody is on same page and has same information what repairs the property can need. The estate can make a decision whether to repair or sell as is.

Why would the heirs want to sell below market to a sibling, unless saving a RE commission is the discount. An appraisal whether for estate or other purpose is not supposed to be biased toward any "side", but not all appraisers are capable of that...though competent appraisers should within a reasonably similar value range...if one is very far off high or low that one is likely the outlier.
 

glenn walker

Elite Member
Joined
Oct 11, 2006
Professional Status
Certified Residential Appraiser
State
California
A couple of RE sales people opinions would not hurt either...what they think they can sell it for

Imo the estate as a group should pay for a home inspection and termite inspection so everybody is on same page and has same information what repairs the property can need. The estate can make a decision whether to repair or sell as is.

Why would the heirs want to sell below market to a sibling, unless saving a RE commission is the discount. An appraisal whether for estate or other purpose is not supposed to be biased toward any "side", but not all appraisers are capable of that...though competent appraisers should within a reasonably similar value range...if one is very far off high or low that one is likely the outlier.
Because it's all about the love : )
 
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