Compared to trading or the PEA or equity savings plan, investing in real estate is so interesting. More and more individuals are deciding to put their property up for sale to supplement their income.
Before getting started, estimating the house is an essential step to accurately determine its price. Despite its many advantages, this expertise is still little known by the general public.
If you are among them, this article provides you with comprehensive information on the subject. Before beginning, it is important to recap the definition of real estate appraisal.
My point of view on appraisal: I consider that having your property appraised is the most emotionally charged step, but it is also the one that requires the most composure. In my opinion, the classic mistake is to confuse the emotional value — memories, work done with passion — with the market value. My editorial perspective is as follows: a successful appraisal is not the one that announces the highest price, but the one that reflects the reality of the area. For me, obtaining a fair price from the start is the only way to prevent your house from lingering on listing portals and eventually selling below its real value.
What does real estate appraisal consist of?
Having a property appraised is a process aimed at calculating its real value. Whether the operation is carried out by a notary or a real estate agent, it is particularly used to determine the fair price of a dwelling. To carry it out successfully, one must neither underestimate nor overestimate the market value.
When you go through a professional, their mission is to find the middle ground between the price offered by the buyer and that demanded by the seller.
To meet all requirements, they use their skills to find a true compromise between the two parties. Moreover, the price they establish remains consistent with the existing rates in the local market.
Just like home staging and some profitable renovations to do before selling, estimating the value of a property proves to be particularly useful.
The goal is to define its correct price that meets the expectations of both the buyer and the seller. A reasonable cost will undoubtedly attract the attention of potential buyers, which speeds up the sale.
A few years ago, I wanted to put an apartment up for sale after having done major decoration work. I was convinced that my superb custom kitchen and high-end flooring justified a price 15% above the neighborhood average. The realization was painful: after three months without any serious visits, I had to face the facts. Buyers only saw the square meters and the location, not the price of my brass door handles. This experience taught me humility: a house is worth what a buyer is willing to pay, not what our heart (or our wallet) secretly hopes for.
How does a real estate appraisal for a house take place?
The valuation of a property is often carried out by a professional. The process occurs in several phases. First, the real estate agent or the notary reviews all the relevant documents about the property.
They closely examine the building permit, the property plans, the file regarding charges, the housing tax, the property tax, the various diagnostics performed, and the invoices or quotes for work already completed. Documents concerning heating and insulation are particularly important.
| Step | Description | Useful remarks |
|---|---|---|
| Contact initiation | The owner contacts a professional (real estate agent, notary, or expert) to request a valuation. | May be free or paid depending on the provider. |
| Information gathering | The professional collects data about the property: area, number of rooms, general condition, equipment, etc. | Documents such as the title deed or plans may be requested. |
| Property visit | A physical visit is conducted to assess the actual condition of the house and its environment. | Allows identification of strengths and defects not visible on paper. |
| Market analysis | The professional compares the property with other similar properties recently sold in the area. | Local trends strongly influence the estimated price. |
| Value calculation | A price range is established taking into account objective criteria and market context. | May include a market value or rental value depending on the need. |
| Report delivery | The professional provides their valuation to the owner, often in the form of a written report. | This document can be used for a sale, inheritance, or loan application. |
Then the expert visits the property with you to verify that all files contain no errors.
They also take measurements of the surfaces while analyzing the property’s compliance with existing regulations. All these steps allow them to identify the weaknesses and strengths of the house.
Even if they already have enough information with all the collected elements, they will not yet set the value of the property. They apply percentage surcharges and discounts to your property.
To do this, they examine the criteria that affect the estimation of its value. This notably concerns the immediate environment of the house, for example its location and neighborhood.
The goal is to determine if the dwelling is well situated and if it is in an attractive city. Even better, it is important to know if it is near public transport, shops, or schools.
Once all this information is well gathered, the real estate agent proceeds to set the sale price. Since they are an expert in the local real estate market, they perform an analysis of the costs of properties similar to yours located in the same area.
What criteria are taken into account to estimate the price of a house?
To avoid proposing a high price that scares off potential buyers, it is essential to master the local market. You can compare your house to identical properties to help know its value.
Energy performance is also an essential criterion for having your property valued. Know that a DPE (Energy Performance Diagnosis) that is not up to standard requires major work to revise the insulation. This entails an additional expense that can discourage the buyer’s motivation.
Moreover, due to new regulations, an energy performance problem complicates obtaining a loan dedicated to renovating the property. This may also slow down the financing for the future owner.
That said, the location of the house is part of another factor facilitating real estate valuation. When it is located in a more renowned municipality, it directly affects the average market cost. A property located downtown holds more value than one on the outskirts.
Also, the neighborhood determines the lifestyle of the residents including future owners. A well-known municipality is often very lively. High schools and middle schools have a good reputation. All these elements simplify the process of housing valuation.
It is equally useful to take into account the number of rooms and the surface area of the property. The quality of the land and its size must be considered.
Also, the general condition of the house is among the criteria to examine. This helps define the extent of work awaiting the buyer. A coat of paint might be enough to restore its shine. In some cases, the condition of the housing requires major work.
It should be noted that external elements such as a swimming pool, a veranda, and a terrace significantly enhance the value of the house. The same goes for its south-facing or east-facing orientation. On the other hand, nuisances can lower its sale price.
How to find a real estate professional to have your house appraised?
- Required expertise: Valuing a property requires extensive knowledge in the real estate sector. Only experts who have undergone studies can effectively evaluate a property without overestimating or undervaluing it.
- Choosing a local real estate agent: It is mainly real estate agents who handle this operation. It is recommended to choose an agency located near the house to be sold. They are capable of mastering the local real estate market.
- Recourse to a notary: In addition, many notaries provide house appraisal services. Experienced in the field, they know perfectly the rates to apply in the city where they practice. As such, they are able to establish the exact value of a property’s price.
- Legal support: Even better, this public officer can also assist you in all sales procedures. With their skills, they help you choose the right buyer.
- Importance of experience: Whether you decide to entrust the valuation of your property to a notary or a real estate agent, it is important to rely on their experience in the field.
- Consulting customer reviews: Consider checking their website to discover comments from their former clients. When they offer quality services, they will surely have many positive reviews on their page.
- Word-of-mouth method: If you have trouble finding a good professional, the word-of-mouth method works perfectly. Do not hesitate to approach your neighbors or friends. They can recommend a better real estate agency in the region.
- Request at the town hall: If your relatives cannot help you, you can go directly to the town hall of the city where your property is located. Generally, it has contacts of local professionals.
- Online search: Otherwise, the internet is another way to find the ideal real estate agency or notary. Many experts offer their services online. To find the rare gem, you just have to search on Google and you’re done.
What is the difference between an online valuation and a valuation carried out by a real estate professional?
Before getting to the heart of the matter, it is worth reminding you that online estimation relies on the skills of real estate experts.
In any case, it must be admitted that its results are somewhat unreliable compared to those offered by a notary or a real estate agency.
In most cases, these online tools are free. They simply provide an approximate value of the selling price of your apartment or house.
Moreover, the criteria considered to evaluate the property are also limited while the price range seems quite broad.
The error with this system often lies in the calculation of living area, net living area, and gross living area. It is not able to provide you with precise data.
According to various studies, this method works only for standard houses or apartments. However, its results are questionable for atypical properties.
It is therefore recommended to refine the real estate estimation with an inspection of the property by an expert in the field. A notary or a real estate agent can be useful to carry out this operation.
How to use a real estate estimation to set the selling price of your house?
Real estate estimation is a crucial step before making a sale. To set the precise value of a property, several criteria must be taken into account.
Besides the area, surface, quality of the land, type of property, and number of rooms, energy performance is decisive on the final selling price.
If the property has excessive heating or air conditioning consumption, this is likely to lower it and affect its market value.
Within the same municipality, differences can also be observed between neighborhoods. The reputation of the district, the environment, the presence of local shops, the attractiveness of the location, good schools, and especially the feeling of security influence the determination of the selling price.
All these elements help to enhance a property. They are taken into account in the estimation of your house to increase its final cost.
Frequently Asked Questions
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As a general rule, real estate appraisal is mainly reserved for a real estate agent, a notary, and a certified real estate expert. If you wish to entrust this task to a specialist, it is better to call on only them.
After studying the house documents, this professional carries out an on-site visit to verify their compliance. Once he obtains all the necessary information, he can set the sale price of the property.
