Putting a Price Tag on Sustainability in Home Sales: Make sure your home is appraised by someone well-trained in energy efficiency features, says Jan Green.
Jun 28, 2015 12:56PM
● By Jan Green
Those that have ever bought or sold a home using a loan for financing know what an appraisal report is—it’s a written opinion of value given by a professional hired by a mortgage company through an appraisal management company. As with any opinion, there can be more than one, so two different appraisers may determine a different estimate of value for the same home.
There can be many seemingly unrelated factors that determine the value of a home, including structural condition, location, recent sales, upgrades and type of upgrades, added features, maintenance of the home, size of the lot and landscaping. An appraiser usually doesn’t give a specific dollar figure for upgrades in a home that may be of a higher standard than a neighboring home that sold recently.
Some appraisers might have a range in mind but still not assign a specific number for a given upgrade. That is why it is always a good idea to provide a list of upgrades that have been added to a home by the current owner, including the date of installation, cost of the upgrades and features added. Armed with such a list, an appraiser can add value based on that specific information.
This list can also include replacing major appliances, including air conditioners and hot water heaters. If energy-efficient items have been added that may not be visible during a review of the interior of a home, add those to the list, too. After all, an appraiser does not climb into attics during a review for an appraisal, and won’t know if a replacement is more energy-efficient unless it is pointed out.
An appraiser must also be familiar with an area (geographical competence). To find out if an appraiser is geographically competent, ask them before they arrive at the home if they’ve worked in the area before. Learn how long they’ve been an appraiser and if they are familiar with the surrounding area, especially if the home is in a master planned community.
If a home has energy-efficient features, they must also be competent and trained to provide value for these features by understanding their attributes and benefits. To know if an appraiser is trained in energy-efficient homes to assess upgrades, visit AppraisalInstitute.org site under the Education/Green Building Resource tab for a state-by-state list of appraisers that have taken the required courses to be included as being Green Qualified.
A two-day Residential and Commercial Valuation of Solar course will be offered Aug. 27 and 28 at First American Title, in Phoenix. Register at usgbcaz.org.
Jan Green is a certified EcoBroker with RE/MAX Excalibur Realty. Contact her at 602-620-2699 or GotGreen.info.