"My Home Appraised $10,000 More Than The Purchase Price"

Apr 29

Written By

Doorvest has been selling many homes lately, and we wanted to share an exciting story by one of our Doorvestors.

She closed on an investment home with Doorvest last year, and it appraised $10,000 more than the purchase price; the home was purchased at $205,000 and appraised for $215,000. This is excellent news!

💡 Doorvestor Insight

"My home appraised $10,000 more than the purchased price, and it has appreciated another $20,000 a year later."

An appraisal is typically required when you go through the home buying process and work with a lender to finance the home. Here are some commonly asked questions about the appraisal process.

What is an appraisal?

Real estate appraisal is the process of estimating your home's "fair market value".

How does the appraisal process work?

An appraiser is a person who conducts the appraisal. They will be assigned to review your home, evaluate it based on the location, and compare it to recently sold homes in the area. For example, if your home is bigger in square footage than homes nearby, the appraiser will add more value to your home.

Why do you need an appraisal report?

Lenders typically require an appraisal report because they want to make sure they are lending you the appropriate amount of money needed to purchase the home and avoid fraudulent activity. For example, if you buy a home from your friend for $1,000,000 when the home is only valued at $100,000. If the bank approves this loan, you and the bank are negatively impacted.

What happens once you receive the appraisal?

Three things will usually happen. First, your home can appraise lower than the intended purchase price. In this case, you can dispute the appraisal so that the bank would reevaluate and loan you the total amount needed to purchase the home. Second, your home can appraise at value, meaning no more, no less. Last, your home can appraise higher and if it appraises much higher - celebrate!

Why celebrate a high appraisal?

In short, this means your home is valued more than the price you paid. Typically, people call this "instant equity" - meaning that whenever it makes sense for you, you can consider taking cash out against your home equity to buy another home, pay for your kid's college, or start a small business.

As of today, our Doorvestor, who had her home appraised $10,000 more than the purchased price, has not only built equity from her down payment, but the property has appreciated another $20,000 since closing.