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Home Features That Can be Difficult to Appraise Written by Max Shafer

A home appraisal is far from an exact science. Professionals must pull from years of experience to balance a plethora of features before arriving at a fair estimate for what a home is worth.

To this effect, certain home features are easier than others to factor into the equation. For example, location is typically pretty straightforward, as appraisers simply have to look at the listed value of similar properties in the area to get an idea of what the home may be worth. In addition, elements such as hardwood floors and slate roofing have been desirable features for decades and have a pretty clear book value for how they affect home value.

However, other features are much more evasive. Certain features may strongly appeal to a certain market while actually serving as a detriment in others. To help make sense of these elements, keep reading to learn more about 5 home features that can be difficult to appraise.

Energy Efficient Features

Ask any panel of appraisal professionals, and the majority will tell you that energy efficient (green) features are one of the most difficult aspects of a home to appraise.

There are multiple reasons for this.

To start with, green design is a relatively new discipline. Although the field of green architecture started to take shape in the 1990s, it hasn’t really garnered widespread attention until the past decade. As such, veteran appraisers are likely not to be as experienced in valuing green features as they are more traditional aspects of a home.

In addition, the quality of green features can be difficult to assess unless you analyze the R-values and take a look at the energy savings over time. Many solar panels, continuous insulationsystems, windows, and roofing materials are quick to dub themselves energy efficient. However, as many of these are new and innovative products, it is tough to assess their long-term benefit without a historical track record to compare against.

These are just a couple of reasons why pinpointing the exact value of energy efficient features is a tall task for appraisers.

Extensive Landscaping

Elaborate landscaping is another problem point for appraisers.

While there is no doubt that quality landscaping is an important aspect of establishing curb appeal, there comes a point when you have to ask yourself: how much is too much?

Perhaps a raised flower bed goes well with fiber cement board and batten siding and cacti go well with a permeable gravel driveway, but what if there is elaborate shrubbery that requires frequent hedging? What if the home comes with a garden?

No matter how good the landscaping looks, it may actually hurt the value of a property if it will require too much effort to maintain, as not every buyer will be interested in exercising their green thumb.

“In-Law” Suites

While more functional space makes a home more valuable, if you are not actually using the space, it can be exceedingly difficult to determine what the space is worth.

This is seen through properties that come with “in-law” suites or other stand-alone buildings adjacent to the main home. If you are able to rent out the second unit or keep it productively occupied, it can be a major asset for the property.

However, if it remains vacant or serves as a glorified storage unit, some appraisers may see such buildings as detrimental to property value. These buildings will elevate taxes, make homeowner’s insurance more expensive, and require maintenance and upkeep resources just like the main home.

And these problems don’t just apply to livable units. Rural homes that come with outbuildings such as cattle barns, machinery sheds, and workshops are notoriously hard to appraise because such “accessory dwelling units” are hard to put an exact figure on.

Features Seen as “Luxury”

Luxury features also give appraisers fits.

When renovating, a certain amount of upgrade is seen as value-adding. However, once you reach a certain point, the value increase starts to level off. For example, a minor, mid-range kitchen remodel will recoup over 72% of its project value, while a major upscale remodel will only recoup 53% of costs.

Therefore, appraisers really have to know the local market to determine how luxury features such as a heated shower floor, swimming pool, home theaters, and spa bathrooms will appeal to the demographic.

Historic or Retro Elements

A final problematic feature for appraisers comes via historic and retro elements.

While newer typically equates to better, there is a strong movement in the era of sustainability to repurpose and rehabilitate old homes to get them up to code without consuming a bunch of new resources.

This has led to projects such as patching concrete, retrofitting historic steel windows, applying sealants to the building envelope and installing updated HVAC systems. This creates challenges for appraisers who must then determine how these newer, innovative features enhance the value of the features that have been in place for decades.

5 Home Features That Are Tough to Appraise

Even in the most stable markets, appraising a home is far from an exact science. It is further complicated by features such as energy efficient additions, extensive landscaping, accessory dwelling units, luxury elements, and historic aspects that are notoriously difficult to place a value on. If you are struggling to find a fair estimate for what your home is worth, contact a professional at Appraisal Management Company today to get on the right track!

Max Shafer is a contributor to the Innovative Building Materials blog. He is a content writer for the construction and home improvement industries with an interest in landscaping, outdoor remodeling, and interior design. Max is focused on educating homeowners, contractors, and architects on innovative materials and methods of construction that increase property value, improve sustainability, and create a warm and welcoming ambiance.

Written by Max Shafer Writer Innovative Building Materials


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