Home Selling

4 tips to find a home appraiser

Who pays for an appraiser report and do you even need an appraisal report? Industry experts share their insight and tips

When it comes to buying or selling a home, your realtor seems like the logical place to go to for answers to all the important questions and concerns you may have, however, a real estate agent is only one option when it comes to getting an accurate appraisal of what a home is worth. Finding a good home appraiser is key in this process.

“The main reason you’d want to pay for an appraisal, in conjunction with selling or buying a home, is to have an unbiased opinion from a third party,” explains Jason Upton, a supervising appraiser at Aedis Realty and industry expert.

As Upton explains, appraisers are paid up front and have no stake in the outcome of the home evaluation. This, along with substantial educational requirements, means that appraisal reports are the gold-market standard for finding a property’s current market value.

“An appraiser will value a property based on their methodologies and principles that they’ve learned through their trade organization,” said Upton. “And this value is very accurate.” In simplified form, a home appraiser provides an opinion on the value of a property based on their inspection, research on outside factors that could affect the home and an overall market analysis. Behind the scenes, however, is the analysis of hundreds of factors that go into valuing real estate and thousands of data points.

Yet, how do you know if you need an appraisal in the first place? It really depends. Lenders pay for an appraisal, particularly in hot markets, to make sure that the loan amount is not higher than the value of the home. But lenders aren’t the only entities that benefit from an accurate fair market evaluation of a property. Sellers who are living in hot markets will often opt for an independent appraisal report to confirm that they are selling or refinancing for top dollar. Plus, homeowners who want to do substantial renovations to their home will often pay for an appraisal report, so they can ascertain whether or not their plans will maintain value particularly over time.

No matter what the reason, finding an appraiser is the first step. Here are four tips on how to find a home appraiser in Canada.

1. Look for a professional home appraisal license or certification

People-with-clipboard-professionals. Finding a home appraiser

Before moving forward with a recommendation from a friend or family member who once used “Bob the home appraiser,” check the Appraisal Institute of Canada (AIC) for some local appraisers in your city and province.

What’s great is that in Canada, professional appraisers are very well educated and are well-licensed. Not only can you find an appraiser through the AIC, but you can narrow down the list based on their expertise. Some appraisers specialize in multi-family surveys — these are appraisal reports done for large developers — while others provide services for individual homeowners.

Another option is to ask your real estate team for a referral. Your realtor, mortgage broker or home stager will probably know an appraiser and would be happy to pass on their contact details. You can then check these referrals out on the AIC site.

2. Interview the home appraiser on their experience

Trust is essential for the relationship between a client and an appraiser. To build that trust, interview the appraiser about their experiences.

Ask them about personal designations or memberships that would demonstrate their commitment to further education in the industry or ethical standards.

If you’re happy with their initial answers than ask them why you should hire them. Listen for the appraiser’s perspective on valuations, personal experiences in the community and whether or not they have a website you can check out to demonstrate these philosophies (most don’t but you never know).

“The number one thing to look for is to ensure that the appraiser is certified by the Appraisal Institute of Canada (AIC),” said Upton. “This is the leading and best-known organization, with the most stringent training and complicated course structure and requires the most experience.”

If you’re happy with the answers the appraiser is providing and know that they have the proper certifications, now is a good time to ask for references. References can be written testimonials, personal interviews with former clients or online reviews.

It’s also important to ask the right questions to confirm what the home appraiser will provide you with if they are the one hired for the job. What will the final report look like? How should you, as a buyer or seller, use this report?

Keep in mind: all home appraisers are required to provide a standard report that breaks down the home valuation and appraisal. The report will include methods and theories used by the appraiser to determine the fair market value of your property, based on a specific date.

“We need a specific day so we can look at what the market was like at that time,” said Upton. “Depending on market conditions, it may or may not be different than two weeks prior given the ever-changing market we live in.”

Most appraiser reports in Canada follow a 25-point inspection list, where the appraiser takes into account anything that is important to the buyer. Those key things include location, the age of the home, size of the home, upgrades to the home, the layout of the home, special features like pools or landscaping and view.

3. Consider home appraisal cost comparison

Man-looking-at-laptop-consider-costs. Finding a home appraiser

There are a variety of costs associated with buying and selling properties. Set your budget for a home appraiser based on the average cost in your city. The range of price for this service should hover around $500 in bigger markets. Remember, price reflects the quality of service and a cheap bill might come with corners cut and missed details. The amount of land and the intricacy of the property determines the value. Ask around to find a price that fits the project.

4. Look for market valuation experience similar to your needs

If you are ready to buy or sell a condo, it is best to hire a home appraiser with experience with a similar property type. You should also verify that the appraiser has experience in your local real estate market or community. This will help when they research economic factors and neighbourhood details. If your goal is to establish future property tax costs (say, due to a large renovation), find an appraiser who can best assess that need.

Once you have found the home appraiser that is best suited to help you buy or sell the property, there are important steps to take:

  • Finalize the costs upfront and determine what the appraiser is to provide you with upon completion of the job.
  • Sign a contract or agreement that states appraisal dates, payment deadlines, and the details that will be included in the final report.
  • Once finished, take the final report to your lender to confirm the sale or purchase of your property (if applicable).

Property appraisers provide more than an opinion — they provide an educated assessment based on more than 100 different market and economic factors. Having an unbiased opinion to help determine the value of a property is important when dealing with such a large investment. Use these tips to help you find a trusted and professional home appraiser.

Alyssa Davies
Alyssa Davies

Alyssa is a personal finance blogger who focuses on mixing finances with laughter. Through her blog, Mixed Up Money, she helps people relate, learn and become inspired. She recently joined Zolo as the content specialist and brings her passion for property and smart money matters to this growing brand.