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Ann Arbor Real Estate Blog

Blog about Ann Arbor and Saline Michigan

Does the Condition of Your Ann Arbor Home Matter to an Appraiser?

Does the Condition of Your Ann Arbor Home Matter to an Appraiser?

conditions of ann arbor housesMany times when I am meeting with potential sellers I am told of all the upgrades to their Ann Arbor home. Some of those matter and others not so much. For instance if you have a new roof it is valuable to the potential buyers but an appraiser will not see it in the same way. They expect you to have a roof, a furnace and a water heater.

What is your Ann Arbor home worth?

Appraisers Condition Report Code

What is an appraiser’s condition report code?

Since September 2011 the appraiser’s code had been used by all appraisers (per Fannie Mae and Freddie Mac guidelines) to evaluate the condition of your home. Appraiser use a field on the Uniform Residential Appraiser Report on the bottom of page one called condition. Many people over look it but it is really important in evaluating the condition of your Ann Arbor area home?

C1: The improvements have been very recently constructed and have not previously been occupied. The entire structure and all components are new and the dwelling features no physical depreciation.

C2: The improvements feature no deferred maintenance, little or no physical depreciation, and require no repairs. Virtually all building components are new or have been recently repaired, refurnished, or rehabilitated. All outdated components and finishes have been updated and/or replaced with components that meet current standards. Dwellings in this category either are almost new or have been recently completely renovated and are similar in condition to new construction.

C3: The improvements are well maintained and feature limited physical depreciation due to normal wear and tear. Some components, but not every major building component, may be updated or recently rehabilitated. The structure has been well maintained.

C4: The improvements feature some minor deferred maintenance and physical deterioration due to normal wear and tear. The dwelling has been adequately maintained and requires only minimal repairs to building components/mechanical systems and cosmetic repairs. All major building components have been adequately maintained and are functionally adequate.

C5: The improvements feature obvious deferred maintenance and are in need of some significant repairs. Some building components need repairs, rehabilitation, or updating. The functional utility and overall livability is somewhat diminished due to condition, but the dwelling remains useable and functional as a residence.

C6: The improvements have substantial damage or deferred maintenance with deficiencies or defects that are severe enough to affect the safety, soundness, or structural integrity of the improvements. The improvements are in need of substantial repairs and rehabilitation, including many or most major components.

This code is used on your Ann Arbor home and every home the appraiser has used to evaluate your home against others.

Selling your Ann Arbor home

ann arbor home condition Last year I took three classes on appraisals. I wanted to learn what appraiser’s were evaluating when they looked at a Ann Arbor Area home. Not just the monetary values they gave the home and the comparable they used but the condition of the property.

I believe it is important to know and tell a seller in the Ann Arbor area what appraisers are looking for when they evaluate a home.

The last thing you want to happen at the end of the transaction, when you are ready to close is for your Ann Arbor home to come in less than the selling price. 

When I get back an appraisal for one of my listings I go through it with a fine tooth comb. I look up in the Ann Arbor MLS every single home the appraiser used to give the value. I look through all the photos and see how the appraiser rated the condition based on the Uniform Residential Appraisal form.

When you are buying an Ann Arbor home for sale and selling your Ann Arbor home this saying simply does not hold true, yet I hear it all the time, “a house is worth what a seller is willing to sell for and a buyer is willing to buy for”.

But, an appraiser and the lender they are hired by determine the value they are willing to lend on. perfect condition

Yes, the condition of your Ann Arbor area home does matter. Buyers, sellers and appraiser’s all have different eyes when looking.

Did this help you understand better how an appraiser looks at the condition of your Ann Arbor property


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