Real Estate Information

Appraisers use several factors when estimating a home's value, including the home's size and square footage, the condition of the home and neighborhood, comparable local sales, any pertinent historical information, sales performance and indices that forecast future value. For detailed information on appraisal standards, contact the Appraisal Institute at 875 N. Michigan Ave., Suite 2400, Chicago, IL 60611-1980; (312) 335-4458.

A home ultimately is worth what someone will pay for it. Everything else is an estimate of value. To determine a property's value, most people turn to either an appraisal or a comparative market analysis.   An appraisal is a certified appraiser's estimate of the value of a home at a given point in time. Appraisers consider square footage, construction quality, design, floor plan, neighborhood and availability of transportation, shopping and schools. Appraisers also take lot size, topography, view and landscaping into account. Most appraisals cost about $300.  A comparative market analysis is a real estate broker's or agent's informal estimate of a home's market value, based on sales of comparable homes in a neighborhood. Most agents will give you a comparative market analysis for free.  You can do your own cost comparison by looking up recent sales of comparable properties in public records. These records are available at local recorder or assessor offices, through private real estate information companies or on the Internet.

Buying into a new-home community may seem riskier than purchasing a house in an established neighborhood, but any increase in home value depends upon the same factors: quality of the neighborhood, growth in the local housing market and the state of the overall economy.  One survey by the National Association of Realtors shows that resale homes do have an edge over new homes. The trade group's figures show the median price of resale homes increased4.3 percent between 1999 and 2000, compared to 2.8 percent for new homes in the same period.

All home buyers should plan to make a final walk-through inspection of their new homes prior to closing in order to make sure the condition of the property is the same as it was on the day you signed your purchase contract.
You should take an early walk through to check repairs agreed to by the seller, but this early inspection does not replace your final walk-through on closing day.
Checking Completed Repairs
Plan to verify that requested repairs have been made as soon as the seller notifies you they are complete. Don't put off this inspection, because if problems still exist you'll need time to get them corrected before closing.
If possible, the home inspector who discovered that repairs were necessary should accompany you to verify that repairs have been made.
Taking Your Final Walk-Through
Always do your final walk-through after the sellers have moved, but before you go to closing.
At this point you're not inspecting for repairs--you simply want to make sure that the home is in the same condition it was in when you signed the contract to purchase it.
Have items been damaged during the move? Inspect floors for rips or gouges. Look at the walls, especially around door frames that large furniture and appliances might have been moved through.
Most offers to purchase include wording that states that all major systems in the home must be working at the time of closing, so it's fine to do a quick test of appliances and other items such as the furnace and air conditioning. Those items should have been checked during the home inspection, but there's always a chance they've quit working since that date.
Make sure all items the sellers agreed to leave are still there.
Make sure all items the sellers agreed to remove have been removed.
If the condition of the home has changed since your offer to purchase it, you are in a better position to get the problems handled when you bring them to everyone's attention before the deed changes hands.
If necessary, repair or replacement funds can be negotiated, deposited into an attorney's trust fund, then drawn on to bring the home back to the shape it was in on your contract date. If you do not use an attorney to close in your state, ask your real estate agent for advice on how to proceed. It's usually best to hold back an amount that exceeds the estimate for making repairs.
An alternative is to negotiate a flat amount to be paid to you at closing. Or, if damage is excessive, you might prefer to delay closing until repairs are made.
The final walk-through is not the time to do a home inspection. It's simply an opportunity to make sure that the home being conveyed to you is the home you agreed to buy.