My house is bigger than my neighbor’s house by two hundred square feet. We both have four bedrooms. I have two and a half baths; they have two baths. My house is two stories, theirs is a ranch. Our houses were built the same year. I am the only owner of my house, their house had multiple renters.
How often have you overheard a neighbor say something similar? Or maybe you have the exact same thoughts yourself. If you end up scratching your head with the same thoughts. There are a few things you should consider.
Often, homeowners are frustrated to discover that their homes are not as valuable as similar homes in their area. They may feel that their homes are more beautiful than the neighbors; they may have made additions that they felt should have added more value.
First you need to understand that an appraisal is just “an opinion of value”. When you have an appraisal done, it is compared to like properties. So, in the above scenario the appraiser will try to use two Stories for the comparisons. The homes used in the comparison should be near each other. They should be similar in age,
There are a lot of variables that will influence the value. But condition is number one. Your neighbor may have more square footage than you realize, bigger bathrooms, nicer finishes, or any number of things that can make a home more valuable. It is possible your neighbors made improvements that added value to their home while yours did not.
If you find yourself in this situation, be patient and consider the possible reasons why the homes were appraised differently. It will not only help your blood pressure it will probably go a long way to keeping the peace with your neighbor.
By R. Jones
