Published August 30, 2023
The Difference Between an Appraisal and a Home Inspection
It might be confusing if you don’t already know the difference between an inspection and an appraisal. After all, why do you need two different people checking out your house before you buy or sell it? It’s a fair question. And in a lot of ways, the two are quite similar, but there are some key distinct differences between the two worthy of noting. We at Tyler Goff Group wanted to take the time and outline those differences for you to remove the mystery from the situation before you get into it.
What Is a Home Inspection?
A home inspection is a thorough, hours long process wherein a certified inspector will enter your home and perform an intense investigation into the functioning of your entire house, from the foundation to the roof. This inspection means they will be looking at your plumbing, your electrical, your windows and window casings. They will go in search of any issues that need to be addressed to keep the house in truly perfect condition.
The home inspection process typically takes between 3 and 4 hours and involves allowing the inspector into every corner, crevice, and crawl space of your home.
How to Prepare for a Home Inspection
Preparation for a home inspection can actually go a couple of ways. If you are the buyer, you will typically be the one ordering the home inspection as you want to be sure you know what you’re getting yourself into. While a home inspection is not required by any governing body or institution, it is an essential part of the home buying process. It usually runs around $400, and is paid for by the buyer. Why? You want all the cards on the table. Nothing is worse than buying a home you think is perfect only to find out after you purchase it that it has serious foundation issues or needs a new roof. You may still decide to buy the home, but you are more likely to ask for either repairs or a lower purchase price. If there was ever a time when the expression “knowledge is power” was true, it is in the case of the home inspection.
Typically, the home inspection is ordered after your offer has been accepted, and the offer is conditional upon the home inspection coming back with only minor issues.
In contrast, sometimes a seller will order a home inspection so they can get ahead of any issues that may have occurred since they bought the home. For example, if you bought your house more than 10 years ago, many things may have cropped up that you wouldn’t necessarily know about but that a home inspector would find. Sometimes, it makes sense for a seller to order their own home inspection and come up with the $400 before putting their house on the market. That way, you can make any necessary repairs or be prepared to lower your sale price.
When the inspector is scheduled to come, the home owner will need to make all crawl spaces and access to electrical and plumbing readily available so the inspector can fully inspect the entire premises.
What to Expect After a Home Inspection
Once the home inspection has been done, you can expect to get a report within 48 hours. At that time, you can decide, as a buyer, whether to ask for conditions or a lower price, or as a seller, whether to make repairs or lower your sale price.
What Is an Appraisal
An appraisal, in stark contrast to a home inspection, is required by the lending institution. A home appraiser is not coming to check out every nook and cranny of the home. Instead, the appraiser is looking at the value of the home. Thus, they will take into account things like the number of bedrooms and bathrooms, square footage, and yes the condition of the home.
They will also, unlike a home inspector, be looking at the outside of the home. Is there a pool? A hot tub? How big is the yard? They will factor in issues like how far the home is from parks and schools, what other houses like this one have sold for recently, and so on. The appraiser is looking at the larger picture of the house in the current market.
How to Prepare for an Appraisal
You will prepare for an appraisal in much the same way you would prepare for a home inspection. Make the home available so the appraiser can get a good understanding of the function of your home and find any major issues that might affect the value of the home. In terms of cost, you can expect an appraisal to cost between $300 and $500, and the cost is typically covered by the buyer, which is usually included in closing costs.
What to Expect After an Appraisal
Unlike a home inspection report, which you will get in 48 hours, a home appraisal report can take weeks to get back. This difference is because the appraiser needs information that is not onsite. Comparative values, neighborhood information, property lines, and lot size are all factors the appraiser will have to research and include in the report. These types of investigations can take time.
Work with a Trusted Real Estate Agent
The best advice we can give you in terms of finding a great home inspector, whether you are buying or selling, or preparing for a home inspection or an appraisal, is to work with a trusted realtor. Your real estate agent will handle everything for you. At least they should! So you are fully prepared for what is coming and know what to expect. Then, once you get your report, you can go over it with your agent to discuss the options that will get you the most value from the situation. Tyler Goff Group is well versed in both home inspections and appraisals, and we are experts at negotiating once those reports come in. Contact us today if you are buying or selling a house and you want to make sure the process goes smooth and easy. That’s what we do.
