The ValuedAudit Blog

Appraisal questions, answered by an appraiser.

164 straight answers to the questions people ask most about home value, low appraisals, loans, estates and pricing. Facts over feelings, with a few jokes so you stay awake.

Market & TimingIs it a buyer's market or a seller's market right now?Nationally, the market has tilted toward buyers. NAR reported 4.8 months of supply in September 2026, up from 4.5 a year earlier, while the median... Market & TimingIs my home value dropping?It depends on where you live. Zillow's September 2026 report showed typical U.S. home values up 1% from a year earlier, while 17 of the 50 largest... Agents & PricingWhen should I reduce the price on my house?Reduce your price when the market tells you to: showings without offers, days on market running past similar homes, and competing listings going... Market & TimingDo home prices drop in the winter?Often a little, and mostly because of the season. Zillow reported typical U.S. home values fell 0.5% from August to September 2026 while still up 1%... Market & TimingWhat is the Case-Shiller index and how is it calculated?The S&P Case-Shiller Home Price Index measures home price changes by comparing repeat sales of the same single-family homes over time. It leaves out... FHA, VA & Loan RulesWill peeling paint fail an FHA appraisal?Peeling paint will not fail an FHA appraisal outright, but it usually triggers a required repair before closing. On homes built before 1978, the... FHA, VA & Loan RulesDo you need handrails to pass an FHA appraisal?In practice, yes. Missing handrails on steps and stairways are one of the most common FHA repair calls, because FHA requires the home to be safe for... FHA, VA & Loan RulesWhat are the FHA roof requirements for an appraisal?For an FHA loan, the roof must keep water out and have at least two years of remaining life. If the appraiser sees leaks or a roof near the end of... FHA, VA & Loan RulesFHA appraisal called for repairs. Who pays and what happens next?FHA does not say who pays. The lender decides which repairs are required, and then the buyer and seller negotiate: the seller can fix them, the buyer... FHA, VA & Loan RulesWhat changed in FHA appraisal rules in 2025 and 2026?In June 2025, HUD's Mortgagee Letter 2025-18 removed several FHA appraisal requirements, including attic and crawl space photos, remaining economic... Loan Officers & LendingHow does the appraisal affect a cash-out refi, and when can I cash out?The appraised value sets your ceiling, because cash-out limits are a percentage of value. For a Fannie Mae loan, at least one borrower usually must... Loan Officers & LendingWhat are the appraisal requirements for non-QM, DSCR and bank statement loans?Non-QM appraisal rules, including DSCR and bank statement loans, are set by each lender and investor, not by Fannie Mae or Freddie Mac. Many programs... Low Appraisals & DisputesHow do I dispute an FHA appraisal? (FHA ROV rules)Ask your lender for a reconsideration of value (ROV). HUD rescinded its 2024 uniform FHA ROV process, with one request and up to five comps, on March... FHA, VA & Loan RulesWhat are the VA minimum property requirements, and what changed in 2026?VA minimum property requirements (MPRs) are the standards a home must meet to be safe, structurally sound and sanitary for a VA loan. They live in... Market & TimingHow accurate is the Zillow Zestimate?It depends on whether the home is for sale. Zillow reported a nationwide median error of 1.94% for homes on the market and 7.06% for homes off the... Market & TimingHow can I check my home's value myself?Start with recent sales of homes like yours, close by, and note how each one is better or worse than your house. Then sanity check with two tools:... Market & TimingWhy are Zillow and Redfin home value estimates different?Zillow and Redfin each run their own computer model, with different data, formulas and update schedules, so they rarely agree. Both are far more... FHA, VA & Loan RulesHow does a VA appraisal work, and how long is it valid?The lender requests a VA appraisal through VA's online system, which assigns a VA appraiser and generates VA Form 26-1805. VA sets appraisal fees and... Appraisal BasicsWhat is a home appraisal, and why does my lender need one?A home appraisal is a written opinion of what a property is worth, prepared by a licensed appraiser who is supposed to be independent of the deal.... Appraisal BasicsHow much does a home appraisal cost?A typical single-family appraisal costs a few hundred dollars. Bankrate, using 2025 Angi data, puts the average at $357, with most between $314 and... Appraisal BasicsWho pays for the appraisal, the buyer or the seller?On a home purchase, the buyer usually pays. The buyer's lender orders the appraisal and the buyer reimburses the cost, often as part of closing... Appraisal BasicsHow long does a home appraisal take?The visit to a typical single-family home takes about 30 to 60 minutes, and larger or more complex homes can take one to two hours. The finished... Appraisal BasicsWhat do appraisers look at during a home appraisal?Appraisers look at two groups of things. The first you can't change: location, lot size, nearby comparable sales and market conditions. The second is... Appraisal BasicsHow do I prepare my house for an appraisal?Fix small defects like leaky faucets and loose railings, keep every utility on, make sure the appraiser can reach every room and outbuilding, and... Appraisal BasicsWhat is the difference between an appraisal and a home inspection?An appraisal estimates the home's market value and mainly protects the lender, which requires and orders it. A home inspection checks the home's... Appraisal BasicsDoes a messy house lower your appraisal?No. Clutter by itself does not lower an appraisal, because appraisers rate the condition of the house, not your housekeeping. But mess can hide... Appraisal BasicsWhy is my appraisal different from my Zestimate?Because they are two different things. A Zestimate is a computer estimate built from public records, listing data and market trends, and Zillow... Appraisal BasicsHow long is a home appraisal good for?It depends on the loan program. For a Fannie Mae conventional loan, the appraisal must be within 12 months of the note date, with an update needed... Buying & SellingWhat is an appraisal contingency?An appraisal contingency is a clause in a purchase contract that lets the buyer cancel without losing the earnest money deposit if the home appraises... Buying & SellingWhat happens if the appraisal comes in lower than the offer?Your lender bases the loan on the lower of the sales price or the appraised value, so a low appraisal leaves a gap someone has to fill. Your main... Buying & SellingWhat is an appraisal gap?An appraisal gap is the difference between the price you agreed to pay and a lower appraised value. Lenders base the loan on the lower of the two, so... Low Appraisals & DisputesWhy did my home appraisal come in low?Low appraisals usually come down to three things: the contract price was ahead of the market, the market cooled, or similar nearby homes sold for... Low Appraisals & DisputesWhat is a reconsideration of value (ROV) and how does it work?A reconsideration of value (ROV) is a formal request, sent through your lender, asking the appraiser to look again at the value because of factual... Low Appraisals & DisputesCan I get a second appraisal if the first one is low?Sometimes, but a low number alone is not a reason. Under Freddie Mac's rules, a lender may order a new appraisal only for documented signs the first... How Adjustments WorkHow do appraisers choose comparable sales?Appraisers pick recent closed sales of homes a buyer would see as real alternatives to yours: same market area when possible, similar size, age,... How Adjustments WorkHow do appraisal adjustments work?An appraiser adjusts the sale price of each comparable home to make it match yours. If the comp has something better, the appraiser subtracts. If it... How Adjustments WorkDoes a pool add value to a home appraisal?Sometimes. A pool adds appraised value only when buyers in your market actually pay more for homes that have one. In warm areas where pools are... How Adjustments WorkHow much value does an ADU add in an appraisal?There is no fixed dollar amount. An ADU is valued on its own line in the appraisal, separate from the main house's square footage, and the adjustment... Appraisal BasicsWho orders the appraisal when you buy a house?When you buy with a mortgage, your lender orders the appraisal, often through an appraisal management company. You usually pay the fee, but you do... Appraisal BasicsCan I choose my own appraiser?For a mortgage, no. The lender selects the appraiser, usually through an appraisal management company, and Fannie Mae does not let lenders use an... Appraisal BasicsDo I need to be home during the appraisal?No. Nothing in the usual lender guidance requires the owner to be there. Buyers typically do not attend, and the listing agent often handles access... Appraisal BasicsIs my appraised value the same as my tax assessed value in California?Usually not. Under Proposition 13, California assessed value starts at market value when you buy or build, then generally rises no more than 2... Appraisal BasicsWhat is the difference between an appraisal and a CMA from my agent?A CMA, or comparative market analysis, is an informal pricing tool your agent prepares to help set a list price. An appraisal is a formal value... Appraisal BasicsDo I get a copy of my appraisal, and when?Yes. On a loan secured by a first lien on your home, federal rules require the lender to give you a free copy of every appraisal and written... Appraisal BasicsDo I always need an appraisal to get a mortgage?No. Some conventional loans sold to Fannie Mae or Freddie Mac can skip the appraisal. Fannie Mae calls this Value Acceptance (formerly an appraisal... Appraisal BasicsHow do appraisers measure square footage, and why doesn't it match the listing?On most conventional loans, appraisers measure living area using the ANSI Z765 standard that Fannie Mae requires. Space partly below grade counts as... Appraisal BasicsHow is an FHA appraisal different from a conventional appraisal?Both appraisals estimate market value the same way, using comparable sales. The difference is that an FHA appraisal also checks the home against... Buying & SellingHow does appraisal gap coverage work, and how much should I offer?Appraisal gap coverage is a contract clause where the buyer agrees to pay the difference between the appraised value and the price, up to a set... Buying & SellingShould I waive the appraisal contingency to win a bidding war?Only if you can afford to close even when the appraisal comes in low. Waiving makes your offer stronger, but without the contingency a low value... Buying & SellingWhat should I fix before an appraisal?Fix the small things that work badly, like dripping faucets, dead bulbs and loose railings, because they can pull down the condition rating. Fix... Buying & SellingCan the seller see the buyer's appraisal?Usually not directly. On a financed purchase, the lender is the appraiser's client, and the appraiser can't share results with anyone the lender... Buying & SellingDo cash buyers need an appraisal?No. An appraisal is usually required by a mortgage lender, so a buyer paying all cash does not have to get one. But without a lender, nobody else is... Buying & SellingWill the house appraise if we offered way over asking?It might, but winning a bidding war does not prove the price. The appraisal has to be supported by recent sales of similar homes. If it comes in low,... Buying & SellingWhat happens if the appraisal comes in higher than the purchase price?Nothing changes at closing. You still pay the contract price, and your lender still bases the loan on the lower of the price or the appraised value,... Low Appraisals & DisputesWhat are the new Fannie Mae and Freddie Mac ROV rules?For Fannie Mae and Freddie Mac loans with applications dated on or after August 29, 2024, a borrower gets one reconsideration of value (ROV) per... Low Appraisals & DisputesHow do I write a reconsideration of value request that works?Lead with documented factual errors, then add up to five closed sales the report missed, each with its MLS number and one or two sentences on why it... Low Appraisals & DisputesCan my real estate agent talk to the appraiser or give them comps?Yes. No federal rule or USPAP bars an appraiser from talking with agents during the appraisal, and agents can share property facts, comparable sales... Low Appraisals & DisputesWhat can I do if I think my appraisal was biased or discriminatory?Put your concerns in writing to your lender and ask for a reconsideration of value before closing, pointing to specific facts in the report. You can... Low Appraisals & DisputesHow do you renegotiate after a low appraisal, and who pays the gap?Nobody pays the gap automatically. It gets negotiated. The seller can lower the price, the buyer can bring extra cash, or the two can split the... Low Appraisals & DisputesWhat can I do about a low appraisal on a refinance?Start by reading the full appraisal, which your lender must give you free, at least three business days before closing in most cases. Check it for... Low Appraisals & DisputesWhat errors should I look for in my appraisal report?Start with the facts about your house: bedrooms, bathrooms, square footage, garage, lot, condition and upgrades. Then check whether the comparable... How Adjustments WorkHow far back can appraisal comps go?Fannie Mae says comparable sales that closed within the last 12 months should be used, but it also says the best comps may not be the most recent. An... How Adjustments WorkHow far away can comps be in an appraisal?There is no fixed mileage limit in Fannie Mae's rules. Sales from the subject's own neighborhood and market area should be used when possible, and... How Adjustments WorkDoes a finished basement count as square footage in an appraisal?No, not in the main living area. Under Fannie Mae and Freddie Mac rules, any level that is partly below ground is below grade, even if it is finished... How Adjustments WorkWhat do appraisal condition ratings C1 to C6 mean?Condition ratings run from C1, a brand new home that has never been lived in, to C6, a home with severe damage that is not fit to live in. C2 is like... How Adjustments WorkDo solar panels increase appraised value? Owned vs leasedOwned solar panels can add appraised value, but only as much as buyers in your market actually pay for them. Leased panels and panels under a power... How Adjustments WorkHow do appraisers handle unpermitted additions and garage conversions?Appraisers do not automatically give unpermitted space zero value. Fannie Mae requires the appraiser to comment on the quality and appearance of the... How Adjustments WorkWill a kitchen or bathroom remodel increase my appraisal?Usually it helps, but rarely dollar for dollar. An appraiser values a remodel by what buyers in your market pay for it, not by what you spent.... How Adjustments WorkWhat counts as a bedroom in an appraisal? Does it need a closet?There is no single national definition of a bedroom. Building codes focus on safety, like an emergency escape window, and the International... Appraisal BasicsDo appraisers look in closets, cabinets, the attic and every room?Appraisers need access to every room, because they walk the whole house, count rooms, measure and photograph the interior and exterior. They may... Appraisal BasicsHow do I read my appraisal report?Start with the final value and the effective date, then check the facts about your house: size, rooms, condition and quality ratings. Next, study the... Appraisal BasicsWhat is UAD 3.6 and the new URAR appraisal form?UAD 3.6 is the new data standard Fannie Mae and Freddie Mac use for appraisal reports, and the redesigned URAR is the single report built on it. It... Appraisal BasicsWhat license does a home appraiser need, and how do I check one in California?California's Bureau of Real Estate Appraisers issues four levels: Trainee (AT), Residential (AL), Certified Residential (AR) and Certified General... Appraisal BasicsWhat is a desktop appraisal and when is it allowed?A desktop appraisal is a full appraisal done without the appraiser visiting the property. For Fannie Mae loans it is allowed only on purchases of a... Appraisal BasicsWhat does "subject to repairs" mean on an appraisal?It means the appraiser valued the home as if specific problems were already fixed. The loan usually cannot close as approved until those repairs are... Appraisal BasicsCan I transfer my appraisal to a new lender?Often, yes, but the transfer happens lender to lender, and the new lender decides whether to accept it. FHA has a formal process tied to the case... Buying & SellingIs a pre-listing appraisal worth it before I sell?It is worth it when the price is hard to pin down or the stakes are high: an unusual home, few comparable sales, an estate, a trust, a divorce, or a... Buying & SellingDoes staging or furniture affect the appraised value?No. Staging and furniture do not add to the appraised value, because the appraiser values the real estate, not what's inside it. Permanent,... Low Appraisals & DisputesWhat happens after you submit a reconsideration of value?Your lender reviews the request first, then sends it to the appraiser if it has enough supporting evidence. On Fannie Mae loans, the appraiser must... Low Appraisals & DisputesHow do I file a complaint against an appraiser in California?File with the California Bureau of Real Estate Appraisers (BREA), either through its online complaint application or on paper form REA 4001, signed... Low Appraisals & DisputesCan a seller challenge a low appraisal ordered by the buyer's lender?Not directly. The appraiser's client is the buyer's lender, so a seller cannot file a reconsideration of value on their own. The seller's agent... How Adjustments WorkWhat is paired sales analysis in an appraisal?Paired sales analysis compares two sales that are nearly identical except for one feature, then treats the price difference as what buyers paid for... How Adjustments WorkIs there a limit on appraisal adjustments (the 15% / 25% rule)?Not at Fannie Mae. Its Selling Guide says it has no specific limits or guidelines for net or gross adjustments, and the size or number of adjustments... How Adjustments WorkHow do appraisers adjust for market changes over time?Appraisers adjust each comparable sale for how the market changed between the date it went under contract and the appraisal's effective date. Fannie... How Adjustments WorkHow do seller concessions and closing cost credits affect comps?When a comparable sold with seller credits or other concessions, the appraiser adjusts its price down by the amount the concession pushed the price... How Adjustments WorkWhat do appraisal quality ratings Q1 to Q6 mean?Quality ratings grade how a home was designed and built and what it was built with. Q1 is a one-of-a-kind custom home with exceptional materials, Q4... How Adjustments WorkDoes the age of a house matter in an appraisal, or only condition?Both show up in an appraisal, but condition usually does the heavy lifting. Actual age is how many years since the house was built. Effective age is... How Adjustments WorkDoes living on a busy street lower your home's appraised value?Often, yes. Traffic is a location factor, and buyers usually pay less for a house that fronts or backs to a busy road. One peer-reviewed study found... Agents & PricingHow do I price my house to sell?Price your house where recent sales of truly similar homes nearby say a buyer will pay, then check that number against the homes you are competing... Appraisal BasicsWhat is USPAP and why does it matter for my appraisal?USPAP, the Uniform Standards of Professional Appraisal Practice, is the ethics and performance standard appraisers follow. It is published by The... Low Appraisals & DisputesCan you appeal an appraisal after closing?Not in the usual sense. Fannie Mae says a borrower's reconsideration of value must be submitted before the loan closes. FHA's uniform ROV rules were... Agents & PricingWhat should a listing agent give the appraiser?Give the appraiser a short, factual packet: MLS data sheets on the sales you think compete, with a line on why each one does or does not fit, the... Agents & PricingIs price per square foot a good way to value a home?Not by itself. Price per square foot treats every square foot as equal, so it ignores lot size, location, views, condition and outside influences... Market & TimingHow do appraisers handle a rising or falling market?Appraisers check each comparable sale for market change between the date its contract was signed and the effective date of the appraisal. If prices... Market & TimingDo interest rates affect home values?Yes, but not in a straight line. Higher rates shrink what buyers can afford, which pushes prices down. They also keep owners with cheap loans from... Market & TimingWhen is the best time to sell a house?Nationally, spring is usually strongest. Zillow found homes listed in the last two weeks of May 2025 sold for about 1.7% more, roughly $6,000 on a... Agents & PricingShould the listing agent meet the appraiser at the house?Yes, it usually helps, as long as you keep it brief and factual. Introduce yourself, hand over a packet of sales and upgrades, leave your card and... Agents & PricingHow do agents pick the right comps for a listing?Start with closed sales from the listing's own neighborhood or subdivision, ideally from the last 12 months, that match its size, layout, lot and... Agents & PricingWhat does days on market mean, and how long is too long?Days on market (DOM) is how long a home sits listed on the MLS before the seller accepts an offer. Redfin says listings over 60 days are generally... Agents & PricingDoes overpricing a house hurt the final sale price?Often, yes. A 2016 Zillow study found that the longer a home sat on the market, the further below list price it sold. Homes on the market about two... Agents & PricingWhat are office exclusive and private listings under NAR's Clear Cooperation rules?Under NAR's Clear Cooperation Policy, a listing must go into the MLS within one business day of public marketing. Since March 25, 2025, sellers can... Market & TimingDo appraisers use pending sales and active listings?Yes, but mostly as supporting data. Fannie Mae requires at least three closed comparable sales, and allows contract offerings and current listings to... Market & TimingWhy do appraisals lag the market or come in below contract price?Appraisals rely on closed sales, and those contracts were often signed weeks or months earlier. In a rising market, that history trails today's... Agents & PricingCan an agent tell the appraiser the contract price or value needed?Sharing the contract price is fine. On a purchase, the appraiser is supposed to receive the full sales contract anyway. Telling the appraiser the... Agents & PricingDoes the appraiser have to use the comps the agent sends?No. The appraiser chooses the comparable sales independently and must verify anything an interested party provides through disinterested sources like... Agents & PricingWhat is a good sale-to-list price ratio?The sale-to-list ratio is the sale price divided by the list price. At 99%, a home sold 1% under asking. NAR's 2025 profile found sellers received a... Loan Officers & LendingDo you need an appraisal to refinance?Not always. On many Fannie Mae refinances the automated system can offer value acceptance, which waives the appraisal, and an FHA streamline... Agents & PricingHow does an escalation clause work with the appraisal?An escalation clause automatically raises a buyer's offer by a set amount above competing offers, up to a stated cap. The appraiser sees the final... Loan Officers & LendingDo you need an appraisal for a HELOC or home equity loan?Usually yes, but it is often not a full interior appraisal. Many HELOC and home equity lenders use an automated value estimate, a desktop appraisal... Loan Officers & LendingCan I get PMI removed with a new appraisal?Often, yes. On a Fannie Mae conventional loan, you can ask your servicer to drop PMI based on today's value if your loan-to-value is 75% or less... Agents & PricingCan off-market or private sales be used as comps in an appraisal?Yes. An off-market or private sale can be a valid comparable if it was an arm's length deal and the appraiser can verify the price and terms through... FHA, VA & Loan RulesWhat are the FHA appraisal requirements (minimum property requirements)?An FHA appraisal does two jobs. A state-certified appraiser on FHA's roster gives a market value, and also checks that the home meets HUD's minimum... Market & TimingHow often do home values change?Home values move all the time as buyers and sellers sign contracts, but the numbers you read are reported monthly and run behind. FHFA releases... Loan Officers & LendingWhat is an appraisal management company (AMC), and why do lenders use one?An appraisal management company (AMC) is a firm a lender hires to find, assign and manage appraisers for its loans. Fannie Mae does not require... Loan Officers & LendingWhat is value acceptance + property data (an inspection-based waiver)?Value acceptance + property data is a Fannie Mae option that skips the appraisal but still sends a trained data collector to record facts about the... Loan Officers & LendingWhy do jumbo loans require two appraisals?They don't always. A second appraisal on a jumbo loan is a rule set by the lender or the investor buying the loan, not a federal requirement. It... Loan Officers & LendingCan I use my own appraisal or pay the appraiser directly for my mortgage?Not for a Fannie Mae loan. The lender, or a company it authorizes, must select and pay the appraiser, and it won't accept a report from an appraiser... FHA, VA & Loan RulesHow long is an FHA appraisal good for?An FHA appraisal is valid for 180 days from its effective date, under HUD Mortgagee Letter 2022-11 for case numbers assigned on or after June 1,... FHA, VA & Loan RulesCan an FHA appraisal be transferred to another lender?Yes. An FHA appraisal is tied to the FHA case number, so when you switch lenders, the new lender requests a case transfer and the appraisal goes with... FHA, VA & Loan RulesCan a new appraisal get rid of FHA mortgage insurance (MIP)?No. For FHA case numbers assigned on or after June 3, 2013, how long you pay annual MIP depends on your loan-to-value when the loan was made, not... FHA, VA & Loan RulesWhat is the VA Tidewater initiative?Tidewater is an early warning step in VA appraisals. When the appraiser expects the value to come in below the contract price, they notify the point... Loan Officers & LendingWhat is a property data report (PDR) vs. an appraisal?A property data report (PDR) is a standardized record of a home's features and condition, collected on site by a trained data collector. It does not... Loan Officers & LendingWhat is a hybrid appraisal?In the lender version, a hybrid appraisal splits the work between two people. A trained third party, such as a real estate agent, insurance inspector... Estates, Trusts & DivorceDo I need a date of death appraisal for an inherited house?No law requires one, but it is usually your best proof. Your tax basis in an inherited house is generally its fair market value on the date of death,... Estates, Trusts & DivorceHow does the step-up in basis work when you inherit a house?When you inherit a house, your tax basis generally becomes the home's fair market value on the date the owner died, not what they originally paid for... Loan Officers & LendingWhy does a flipped house need a second appraisal?A federal rule for higher-priced mortgage loans requires a second appraisal when the seller bought the home within 90 days and the price is more than... Estates, Trusts & DivorceCan an appraisal be done for a past date, and how far back can it go?Yes. A retrospective appraisal values a home as of a past date, such as the day someone died, using the sales, records and market data from that... FHA, VA & Loan RulesCan an FHA lender order a second appraisal if the first one is low?Not because it is low. Under HUD Handbook 4000.1, an FHA lender may order a second appraisal only when the underwriter finds the first one materially... Estates, Trusts & DivorceDo I have to pay capital gains tax when I sell an inherited house?Only if you sell for more than your basis. For an inherited house, basis is generally the fair market value on the date of death, not what your... Estates, Trusts & DivorceDo I need to go through probate for my parent's house in California?Maybe not. For deaths on or after April 1, 2025, California lets a successor skip full probate for a primary residence worth $750,000 or less by... Estates, Trusts & DivorceHow do you buy out a sibling's share of an inherited house?Agree on the home's fair market value, multiply it by your sibling's ownership share, pay it, and record a new deed. If you cannot agree, a... FHA, VA & Loan RulesHow do I challenge a low VA appraisal (reconsideration of value)?After the VA issues its Notice of Value, the buyer and agent can prepare a written reconsideration of value (ROV), and the loan officer sends it to... Estates, Trusts & DivorceWill my inherited house be reassessed under Prop 19?Probably, unless a child moves in. For California transfers on or after February 16, 2021, a parent's home keeps its low tax value only if it was the... FHA, VA & Loan RulesWhat are USDA appraisal requirements?For a USDA guaranteed loan, the home must meet HUD Handbook 4000.1 property standards, or meet them after repairs. The lender picks a state-licensed... Estates, Trusts & DivorceHow is the house valued in a California divorce, and as of what date?In a California divorce, the court generally values the house as near as practicable to the time of trial, not the date of separation. On 30 days'... FHA, VA & Loan RulesHow does the appraisal work on an FHA 203(k) renovation loan?On an FHA 203(k) loan, the appraiser values the home as if the planned repairs are finished, called the after improved value. HUD caps the base loan... Estates, Trusts & DivorceHow does a spouse buyout of the house work in a California divorce?The spouse keeping the house generally pays the other spouse half of the community equity: the home's market value minus the loan, divided by two,... Investors, ARV & ConstructionWhat is after repair value (ARV) and how does an appraiser determine it?After repair value (ARV) is an estimate of what a property will be worth once the planned rehab is finished. An appraiser determines it by studying... Investors, ARV & ConstructionHow do hard money lenders use ARV, and what is the 70% rule?Many hard money lenders cap a fix-and-flip loan at a percentage of the after repair value (ARV), with 70% often cited as a typical maximum. The... Estates, Trusts & DivorceHow much does a date of death appraisal cost?Kiplinger reports that formal inherited home appraisals typically run $500 to $1,500, varying by area, size and complexity. Expect the fee to rise... Estates, Trusts & DivorceDoes a surviving spouse get a full step-up in basis in California?Often, yes. California is a community property state, so when a spouse dies, the full fair market value of community property, including the... Estates, Trusts & DivorceWhat does a California probate referee do, and how much does it cost?A California probate referee is an appraiser appointed by the State Controller who values most noncash assets in a probate estate, including real... Estates, Trusts & DivorceWhat is the 90% rule when selling a house in California probate?Under California Probate Code section 10309, a court can confirm a private probate sale of real property only if the price is at least 90% of the... Estates, Trusts & DivorceDo I need an appraisal when a parent's house is in a living trust?Usually, yes. A living trust avoids probate, but the house still generally takes a new tax basis equal to its fair market value on the date of death,... Estates, Trusts & DivorceHow is the Prop 19 $1 million exclusion calculated?Add the parent's factored base year value to the adjusted $1 million amount, which is $1,044,586 for transfers from February 16, 2025 through... Estates, Trusts & DivorceDo I need an appraisal to gift a house to my child?In practice, yes. Almost any house is worth more than the $19,000 annual gift tax exclusion, so the parent generally must file a gift tax return,... Estates, Trusts & DivorceDoes the estate need to file an estate tax return in 2026?Most estates will not have to. For people who die in 2026, the IRS basic exclusion amount is $15,000,000, and Form 706 is generally required only... Estates, Trusts & DivorceCan I use the sale price or Zillow instead of an inherited house appraisal?The sale price sometimes can. Zillow and the tax bill usually cannot. Kiplinger reports an arm's-length sale within six to twelve months, in a stable... Estates, Trusts & DivorceWho picks the appraiser in a divorce?Usually the spouses do. In California they can agree on one appraiser, often through their attorneys or mediator, or each hire their own and let the... Investors, ARV & ConstructionWhat is the difference between an as-is value and an as-completed value?An as-is value is what the property is worth today, in its current condition. An as-completed value is what it is expected to be worth once the... Investors, ARV & ConstructionWhat does an appraiser need for an ARV or renovation appraisal?An appraiser needs to know exactly what will be built: plans, a written scope of work with finishes, a budget and a timeline. Under Fannie Mae's... Investors, ARV & ConstructionHow do construction loan appraisals work?The appraiser values the finished house before it is built, using the plans, specifications and sales of similar completed homes. That as-completed... Investors, ARV & ConstructionWhy do new construction appraisals come in low?New construction appraisals can come in below contract because the appraiser has to support the price with closed sales, not the builder's price... Investors, ARV & ConstructionCan you sell an ADU separately as a condo in California (AB 1033)?Sometimes. AB 1033 lets California cities and counties adopt an ordinance allowing a house and its ADU to be sold separately as condominiums. It is... Investors, ARV & ConstructionHow are duplexes, triplexes and fourplexes appraised?A duplex, triplex or fourplex is appraised with comparable sales plus an income approach. For Fannie Mae loans, the income approach is required on... Investors, ARV & ConstructionWhat is a gross rent multiplier (GRM) and how do appraisers use it?A gross rent multiplier is a sale price divided by its rent. Appraisers build it from sales of similar properties that were leased when they sold,... Investors, ARV & ConstructionWhat is Form 1007, and how much rent will a lender count?Form 1007 is the Single-Family Comparable Rent Schedule, the appraiser's estimate of market rent based on comparable rentals. On a purchase, Fannie... Investors, ARV & ConstructionWhat is the FHA 90-day flip rule?Under FHA rules, a home resold within 90 days of when the seller acquired it is not eligible for an FHA-insured loan. The clock runs from the... Estates, Trusts & DivorceWhat is the alternate valuation date, and when can it be used?Under Internal Revenue Code section 2032, an executor can elect to value the whole gross estate six months after death instead of on the date of... Estates, Trusts & DivorceCan I use my own appraiser instead of the probate referee in California?Not for the court inventory, unless the court waives the referee. In California probate, the referee appraises everything except cash-type assets the... Estates, Trusts & DivorceHow does a California court value property in a partition action?In most California partition cases, the court orders an appraisal by a disinterested, California licensed appraiser it appoints, who values the whole... Estates, Trusts & DivorceWhat is an IRS qualified appraiser and qualified appraisal?For gift tax purposes, a qualified appraiser regularly appraises or holds out as an appraiser, is qualified for that type of property, and is not the... Estates, Trusts & DivorceWhat happens if the IRS says my stepped-up basis was too high?You would owe the extra tax, generally with interest, and possibly a penalty. Under Internal Revenue Code section 6662, claiming a basis of 150% or... Investors, ARV & ConstructionCan ADU rental income help me qualify for a mortgage?On a Fannie Mae loan, yes, within limits. Fannie counts rent from only one existing ADU on a one-unit primary residence, only for a purchase or...
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