Man writing on a clipboard Whether you’re buying or selling a home in Charleston SC, refinancing or applying for a home loan, getting an appraisal is a critical step. Having an objective, third party opinion help you determine what your home is worth in the current real estate market will help you and your Realtor establish a realistic listing price. In order to get the most out of it, knowing what goes into the appraisal process will give you a general idea of what the appraiser looks for when determining value.

A home appraisal is more or less a “very educated guess ” on the worth of your home, or the home you’re looking to purchase. As a buyer seeking a mortgage to purchase, you won’t be able to buy your dream home without one.  Even if you are making an “all cash ” purchase, it just might be a good idea to hire an appraiser to make sure you’re paying fair market value. What’s most important in an appraisal are your home’s physical characteristics (age, square footage, the number of bedrooms and baths, lot size, location) as well as its “observable condition. ” This takes into account the condition of what is permanently part of, or attached to, the house. After that, the appraiser is going to take into account what comparable homes in the neighborhood, or within a certain mile radius, have sold for recently.  In an established neighborhood, where homes are similar in age or design and a steady pace of move-ins and move-outs, this may be an easy exercise for an appraiser, as there will be many nearby homes which act as “comps. ”  

Oftentimes, in Charleston’s varied real estate landscape, there are additional factors that can influence value and it takes the skills of an experienced appraiser to establish a fair value for the appraisal. For example, a property that is considered “waterfront ” might simply have water views, or offer tidal creek water access, deep water access, or even be oceanfront.  As you can imagine, each of these would affect “value ” in an appraisal, and often explains why even similar properties, can have vastly different appraised values.

You may think about fixing or renovating a few little things here and there before you sell. This certainly may be a good idea, but keep in mind there are some improvements you shouldn’t typically expect to get your money back on.  What might be important cosmetic enhancements that will make your home show better and in turn sell more quickly, may not be things that will increase its value to an appraiser.  However, if you plan renovations that add say, an additional bathroom or more square footage, these will add to your home’s value.

The condition of your home makes a big difference in appraising. The appraiser will measure condition on a ranking system from 1 to 6 – one being the best possible condition, and six meaning substantial repairs will be required. If you’re home is ranking consistently as a 5 or 6, you may not get the approval from a mortgage company.

As you go to make repairs, keep these categories in mind:

C1 – Very recent improvements have been made, with no physical depreciation.

C2 – Outdated components have been updated where dwellings are almost new, or recently completely renovated.

C3 – Well-maintained structure with limited physical depreciation.

C4 – Normal wear and tear with some minor deferred maintenance. 

C5 – Obvious maintenance needed, and overall livability is somewhat diminished.

C6 – Substantial repairs will be needed, enough to affect safety and structural integrity. 

In addition, appraisers will consider the property values of surrounding homes in the neighborhood. If one of the homes on your street has sold for significantly more, or significantly less than what your home is worth, it will likely affect your appraisal. 

Note: When it comes time for your Charleston SC home appraisal, and you’re thinking about making some home improvements, our talented Luxury Simplified Renovations team is here to help. In addition, if you need any expert advice when it comes to home values, reach out to our experienced Luxury Simplified Real Estate team. 

Interested in Learning More?

Our expert teams - from development, investment, real estate, and property management - have experienced it all and have the insight to help you along the way.

Find Out More