What improvements actually ADD value to your home? We talk with Joel Frost, expert Utah appraiser, about what improvements add value or reduce value.
0:59 – Joel’s credibility – He seen 16,000 homes. Today we’re talking about improvements, and what you get out of them.
1:49 – Specialty kitchen with $50,000 Hibachi grill upgrades. How much value did it add in an appraisal? None. It actually REDUCED value! A typical homeowner won’t use it – it’s not an upgrade for the average buyer. The underwriter is going to want a comp showing value.
4:25 – Which improvements give you the most bang for the buck? Fannie Mae and Freddie Mac track kitchens and bathrooms. Kitchens and bathrooms get you money back the easiest.
5:19 – What about quality of improvements? Granite counter tops vs Formica, for example. Q1 – Q6, highest quality is Q1. There are a lot of Q3 and Q4. Condition is ranked the same way (C1 – C6). You can have a high quality finish Q1 at C6 condition.
6:31 – So, should I clean my house for the appraiser? Appraisers should be able to “see through” the clutter, but it can’t hurt.
7:22 – If you’re planning a remodel, talk to an appraiser or experienced agent. Overbuilding is a serious issue that kills improvement value. It can leave you without comps. Is it amazing? Yes. Will it recover value? Unlikely.
8:40 – What’s a Q1? A Mansion, Parade of Homes house. Built to the nines. Comps will include only high-end (Q1) homes.
10:30 – Appraisers are limited to a very transient inventory.
10:59 – What are appraisers doing to account for this “Seller’s Market?” Appraisers should be making “market time adjustments”. How do you know you have a good appraiser? Look at their market time adjustments. You CAN contest an appraiser’s opinion of value. Appraisers pull data from the MLS, just like agents. A good agent can give you statistics and information. Reatlors are NOT appraisers, but they can do some good work based on information. Make sure your lender has a good pool of appraisers.
17:30 – What did we learn today?
19:27 – Bloopers
*No hibachi grills were harmed in the filming of this real estate discussion.
Please contact us to tell us you love us, you want to hire us! Call or text:
Joel Frost is an Appraiser with
ExcelAppraise
Reach him on Twitter @JustAskJoel
https://twitter.com/justaskjoel
Realtors with Hive Collective at Presidio Real Estate:
Tyler Cazier: 801-210-0230
Aric Wiszt: 801-228-7687
Lender with Elite Team at Security Home Mortgage:
NMLS: 178787
Jason Christiansen: 801-669-7271
NMLS: 240472
A Production with Security Home Mortgage’s Jason Christiansen, and Hive Collective at Presidio’s Tyler Cazier and “Mr. Suit” Aric Wiszt.