Do not get the house appraised. Let the buyer get the appraisal. Their lender will actually order it if a lender is involved. Lenders usually require their own appraiser in house or one that they have pre-approved.
To see if you have a deal even worth flipping you will want to do pull comps and compare with several other properties that have sold recently.
[i][b]“Do not get the house appraised. Let the buyer get the appraisal. Their lender will actually order it if a lender is involved. Lenders usually require their own appraiser in house or one that they have pre-approved.”
“To see if you have a deal even worth flipping you will want to do pull comps and compare with several other properties that have sold recently.”[/b][/i]
I would add: NEVER take an appraisal @ face value. You’ll want to know the purpose of the appraisal, and who was the intended user. If it was for refinancing…be cautious. Many appraisers have complained, and much has been written of late regarding, lender pressure upon appraisers to inflate values.
Develop a relationship with an appraiser who’ll work in an unbiased manner, or do your own homework. It takes years to become proficient @ appraising–an experienced appraiser could be worth their weight in gold to you.
After you have looked at 100 houses and compared price per foot in an area you will just know when you have a good deal. I looked at many 800 to 900 foot houses in the low 50’s and then found a 1500 footer for $30,000. I bought it with minutes and made $20,000 on the rehab. I looked at muco apts on Loopnet for $20,000 to $100,000 per unit and bought 31 units for $160,000. Sure they were run down and in a bad area but the area was bad because these apts were bad. I have cleaned them up and rehabbed them and will make some good money for the risk and effort. It is not easy, do not get me wrong. I lost several appraisal fees and earnest money checks on deals that I thought were good and turned out to be marginal. I would have still done them if it were not for the hight cost of hard money, They would have made excellent keepers at 80% of market value but I needed 70% after rehab.
Yes an appraiser is needed. I am not going to hire an appraisal on every property listed on the MLS to see if they are worth the asking price and try to find the best deal. After looking at a lot of property you just know a deal is a deal. It is called a no brainer when it takes little thinking to know you have a great deal.
Your local Realtor is the best source for sold comps. You may also be able to get a great appraiser to help you with comps as well. You can also look at properties on the market and compare asking prices if nothing else is available. There are several sources for available properties, Realtor.com is one. Our American Statesman newspaper has an MLS search section as well as many Realtors websites.
“Do you still the house will appraise up in the 100k”
Much more information is needed.
As an appraiser I look for comparable sales based on proximity to the subject. If I can’t find sales in close proximity…I expand the search parameters to include those homes which have sold in nearby competing neighborhoods offering similar locational influences and amenities. (Don’t forget to include active listings & pending sales in your search).
I also look for homes of similar age, style/design, quality construction, condition, bedroom & bath count, and square footage–built on similar site sizes with similar amenities (i.e., view, PUD, etc.). You’re looking for exact duplicates–which rarely exist). The next best thing is to bracket everything I touched on above. For example; say you have a house 1,600 SF–try & bracket that SF–comps @ 1,400 SF & 1,800 SF would be bracketing (keep it as close to the subject as possible). Do the same thing w/bed-bath count, lot size, and age. Construction quality & condition are equally as important.
The more recent sales data (no further back than 6 months in a HOT, HOT market & even that may be too long), and volume of data you can lay your hands on the better.
Once you’re fairly certain you have a prospective house…you could always ask local appraisers if they’re willing to perform staged, or phased assignments for you (nominal fee). That’s basically data research & opinion based soley on that research. Don’t forget to ask if that fee could be applied to a full appraisal should that be needed later. As tedjr stated, lenders typically have an approved appraiser list…some will accept appraisals from ANY Certified or Licensed Appraiser–start there.