Real estate investing in Toronto or any burgeoning market can be challenging to navigate, especially when you are only trying to understand and weigh your options. One of the main things that you should be familiar with when investing in real estate is home appraisal—what it is, who does it, and how it’s done.
Appraisal companies are everywhere, but there are times when appraisal firms specialize in certain types of valuation. When looking for an appraiser, it pays knowing what type of real estate appraisal they are most well versed in and how in-depth their valuation or assessment goes.
A home appraisal is only one form of real estate appraisal. It is the process of determining the monetary value of a property, in this case a house. It is different from (although it may involve) a home inspection, in which the condition of the major features of a property, including its foundation, structure, electrical work, heating and cooling systems, plumbing, and utility networks are outlined. Home inspections are typically performed when selling a property and are done by qualified home inspections to give property buyers and sellers an overview of the real estate’s condition. However, it doesn’t say anything about the property’s fair market value. This is where a real estate appraisal comes into play and where an appraiser’s job begins. The main purpose of an appraisal is to determine a property’s fair market value based on its overall condition, its history, as well as how it fares with similar properties in the local market.
Pre-purchase or pre-sale real estate appraisals inform home buyers and sellers about the true market of a property, enabling them to make intelligent decisions when it comes to their home purchase or sale. These appraisals are highly recommended to prevent any last-minute issues that could delay the investment or sale or even break the deal altogether.
A professional appraiser can provide different services, depending in their qualifications, ranging from residential/commercial valuation estimates to estate planning settlements, tax assessment reviews, dispute resolutions, market rent as well as trend studies, and even cost/benefit for investment analyses.