Episode 21: Behind the Appraised Value with Randy Lewis

Understanding Appraisals: What Really Determines Your Home's Worth?

Appraisals play a crucial role in real estate transactions, but many people don’t fully understand how appraisers determine a home’s value. In Episode 21 of Real Estate Tips with S&L, we brought in Randy Lewis, a seasoned appraiser, to break down the appraisal process and give us the inside scoop on what factors truly influence a property’s value.

Here are the key takeaways from our conversation:

1. It’s About More Than Just Square Footage

While square footage is an important factor, it’s not the only thing that appraisers consider. Randy explained that appraisers also evaluate location, condition, upgrades, and the overall market to determine a property’s worth. It’s about looking at the bigger picture.

2. The Role of Comparables (Comps)

Comps, or comparable sales, are one of the most significant factors in appraisals. Appraisers look at recently sold homes in the same area with similar features to gauge the fair market value of the property. Understanding how comps work can help sellers and buyers set realistic expectations.

3. Condition and Curb Appeal Matter More Than You Think

Randy emphasized how the condition of a home — from its foundation to the roof — can significantly affect its appraised value. Simple improvements like fresh paint or updated fixtures can add value, while deferred maintenance can cause a property to be appraised lower than expected. Curb appeal also plays a part in creating a good first impression.

4. The Market’s Impact on Appraisals

Appraisals aren’t immune to the ups and downs of the real estate market. In a hot market, appraisers may be more willing to value homes higher, while in a cooling market, they may adjust values accordingly. It’s crucial to have realistic expectations based on current market conditions.

5. Appraisals vs. Inspections: They Serve Different Purposes

While appraisals focus on determining a property’s market value, home inspections are about the condition of the home itself. Randy clarified that appraisers are not inspecting every detail of the property — they’re evaluating its overall value. Buyers should always conduct an independent inspection in addition to the appraisal.

The Bottom Line:

Understanding the appraisal process is key to navigating real estate transactions smoothly. Whether you’re buying or selling, knowing how appraisers assess value can help you make more informed decisions and avoid surprises.

Thinking about buying or selling? Let’s talk — I can help guide you through the appraisal process and ensure everything goes as smoothly as possible.

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