Appraisal before or after selling your home?

Wondering whether to have your home appraised before or after selling it? The short answer: for most buyers a valuation is part of arranging the mortgage, so the timing is largely fixed. For sellers it's optional but can strengthen your asking price. Here's how it works and what to keep in mind.

What does an appraiser do?

An appraiser (taxateur) determines the current market value of a home based on a range of factors, including the property's general state and condition, the plot, and recent comparable sales nearby. They record their findings in a valuation report, which your mortgage lender uses to decide how much to lend.

Difference between selling price and market value

When you buy or sell a property, it helps to remember that the market value and the selling price are not the same thing.

• Market value is the value an independent appraiser determines in a valuation report. It's the figure the bank uses when deciding how much mortgage to grant.
• Selling price is what a buyer actually agrees to pay. It can be higher or lower than the market value, depending on how fast you want to move, how popular the location is, and overall market conditions.

A WOZ value or an automated estimate is a statistical figure, not a formal valuation. Only an independent valuation report states the substantiated value of a specific property, which is why it's required when applying for a mortgage.

Valuation is mandatory when buying with a mortgage

If you're buying a home and applying for a mortgage, an independent valuation report is mandatory. It's a key factor in determining your maximum mortgage. Sometimes the lender arranges the valuation; otherwise you instruct an appraiser yourself. A mortgage advisor can also give an indication of the value and the costs involved before you commit.

Keep the purchase price and appraisal value close

It's important that there's not too big a gap between the purchase price and the appraised value. Your mortgage is based on both your income and the value of your home, and since 2018 you can borrow at most 100% of the appraised value. If the appraisal comes in below the purchase price, you can't finance the difference with your mortgage and will need savings to cover the shortfall.

On top of the purchase price, also budget for buying costs such as the notary and, in most cases, 2% transfer tax (starters who qualify for the first-time-buyer exemption may pay none). If you have no savings of your own, the mortgage may not go through.

Compare appraisers in your area

Want a competitive rate? HuisAssist compares appraisers in your area completely free and without obligation. We match you with appraisers that score best on rate, customer rating, and distance.

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