What are appraisal reports and do I need them? by Geraldine Santiago
If you are buying real estate in Vancouver, you will need an appraisal report for the property you will be purchasing, especially if you will need a mortgage. The appraisal report is typically paid for by the mortgage company. The report is prepared by a professional appraiser who makes an evaluation of the property they will be funding.
An on-site inspection of the property's condition is performed, and appraisers look at active lisings within the same parameters (same type of dwelling, same construction, same number of bedrooms and bathrooms, same lot size, same neighbourhood) and so on, for a period of up to 3 months and earlier as well as SOLD, CANCELLED, OFF THE MARKET, EXPIRED listings. If data cannot be obtained within these parameters, a wider parameter is extended though it will not be as accurate.
The property you are considering to purchase is the property that will be the subject property and the other propeties that are in the MLS system for data, will be the analyzed with a positive or negative value, being superior to the subject property or inferior. Some aspects appraisers will also look at, and comment on may be the parking, street parking, neighbourhood, site influences, neighbourhood calming programs, neighbourhood blockwatch, parks, commuinty centre, a view, landscape, trees, ambiance. It is easier to do an apprasal report on a condo verses a single detached home. There are more eternal and different variables in a single detached home with many homeowners upgrading their homes with renovations, new appliances, new plumbing systems, heating systems, etc. The appraisal report value is important because it must be in line with thevalue you have negotiated to purchase with the seller.
The property appraisal report also will include market statistics of the neighbourhood and area and sometimes notations by the appraiser.
If you are wanting to get a copy of your appraisal report done by the mortgage company, you may be able to get one though a small fee may be required. it is good to have this on hand. The reason for an appraisal report is so that the banks- who are loaning you the money to pay for your mortgage- want to make sure that the value in the property is the value you are paying for.