Homeowners thinking of remodeling to boost the value of their property may want to first hire a professional appraiser to look at the home improvement plans. The appraiser can do a market appraisal and demonstrate "before and after" values. Having that information can help avoid costly mistakes while guiding decisions to ensure that you get maximum equity from a project.
Adding equity to a property is always a smart financial move, and upgrading a home through a remodel or other similar project also offers the advantage of an enhanced quality of life and enjoyment for those living in the home. These days, building contractors, architects, and designers are experiencing lean times due to the housing construction slowdown, so many are offering their professional services at deep discounts. That provides an extra incentive to do improvements.
Before and after values
Before embarking on a home improvement initiative, it may be a good idea to consult first with a nearby appraiser to find out how to get the most bang for your buck. While most of us deal with appraisers only in relationship to applying for a mortgage, or figuring out how much to pay for a piece of real estate, these licensed professionals are also helpful for planning upgrades, add-ons, remodels, and makeovers. Various methods of appraisal exist, and a skillful professional can select and perform the type that's most appropriate for figuring out a "before and after" value for your home. Plug in a wide range of possible factors into the appraisal equation, and the formula will automatically calculate gains and losses in equity based on actual market value.
One way to come up with a valuation is to compare it to other houses of the same size. But another way is to estimate the value of the home if the owner first builds an extra bedroom, and converts the garage into a rental apartment. The same can be done with any number of options or ideas, from adding a swimming pool or a deck, to remodeling a kitchen or finishing a basement to make it into a recreation room.
Plan ahead before you refinance
In order for the appraiser to do an accurate job, it's important to have specific information and itemized costs. Just telling the appraiser that you want to upgrade the kitchen isn't enough, whereas sharing blueprints and competitive bids from general contractors can enable the appraiser to give you an entirely realistic estimate of future value. Perhaps you're trying to decide between adding a bathroom or simply redoing the one you already have. Share the plans with the appraiser, and she will compare the potential equity in a comprehensive report that will give you lots of detailed information for making financial choices. The cost of the appraisal may be around $300, but it could save you many times that amount in terms of the outcome of your home improvement project and the impact on your actual home equity.