When a married couple decides to end their marriage, they usually try to use every means available to limit acrimony and unnecessary arguments. Despite any such intentions, arguments can arise unexpectedly. One such cause of hidden acrimony is deciding on the value of the family residence. This happens most frequently when the homestead has accumulated substantial equity or fair market value. One of the most effect methods of resolving such an argument is to retain a professional appraiser to provide an opinion about the fair market value of the home. An opinion as to value written by a professional appraiser can remove much of the subjective debate about how much the house is worth and how it can be fairly divided.
What is an appraisal?
A professional opinion as to value provided by a professional appraiser is a careful analysis of market value factors that may affect the amount that a willing buyer will pay a willing seller. The appraisal report is provided in writing to the parties who paid the appraisal fee and to the court.
How is the appraisal report prepared?
An appraiser begins the appraisal report by visiting the property and carefully observing the special features that may affect the property’s value. The appraiser carefully measures the dimensions of each room, the overall size of the house, and of the lot on which it sits. The appraiser will look into crawl spaces, check the condition and age of water and electrical service, whether the foundation shows signs of seepage, and examines the exterior to gauge the condition of both the roof and walls. The appraiser also notes the presence of amenities that may not affect the value of the property, such as a swimming pool or wine cellar.
Once the inspection is complete, the appraiser choses an approach to value. While other approaches are available, most if not all appraisers use the sale comparison approach to value. This approach requires the appraiser to choose three homes in the neighborhood that have sold within the last six months. The appraiser then compares the size, condition and amenities in each comparable property with the subject property. The appraiser will adjust the estimated fair market value for the subject property according to how it compares to the three properties chosen as comparables. The appraiser, relying on his or her experience, may decide that the subject property is worth more than any of the comparables and concludes that the subject should be worth more than any of the comparable properties. The appraiser’s opinion as to value will be embodied in a written report as mentioned above.
Choosing an appraiser can be a tricky choice. Usually, the best method is to rely on the advice of an experienced divorce attorney to select an appraiser who is qualified, experienced, and knowledgeable.