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Many companies offer online home appraisals. These companies, which include www.ditech.com, www.valuemyhouse.com, www.electronicappraiser.com, and many others, provide an appraisal of your property based on the price that other, similar homes in your area recently sold for. The shortcoming of these services is that no one actually goes out and looks at your home, and the services rely on your description of your property to arrive at a value. These services may be somewhat useful for setting your asking price, but a mortgage lender is unlikely to use an online appraisal.
There are several problems with on-line appraisals, with only one being that the machine cannot see the house. But the big problem is the system does not discrimate well in the selection of comparable sales and does not adjust for real life amenity differences but typically will only appeal a square foot multipier based on linear regression. Often, because the machines do not well account for the law of diminishing return, small houses "appraise" low and large house "appraise" high. I've seen a 1.0 million house show a market value on one of the big sites for nearly 2.0 million. That's a big difference. The worst advise you can give someone is to base their list price on one of these systems as well...because they are based on tax record sales, which lag behind MLS data by weeks, sometimes longer, and when selling your house in a changing market you'd want to know what the house can sell for in the next 30 to 120 days, not what it would have sold for if it contracted 3 months ago.
|Sheri Ann Richerson|