A physical Property Evaluation is perhaps the most critical part of evaluating the value of a property. A property evaluation is simply a physical visit to the location to make observations and take notes so that you can later apply this observation so your overall valuation of the property. Taking a checklist with you when you visit can help insure that details are not missed. It is very easy to convince yourself that you will remember all the details of what you see and that you will be able to distinguish which attributes that you saw in which properties. In reality, it is extremely easy to confuse them. After the first three or four properties, all the properties begin to run together! How can you keep them separate and your records accurate? Below are several tips that are very helpful!
Organize your day before you leave the house
- Organize the Order of Properties – If you have a program such as Microsoft Streets and Maps, use this to input all the addresses you intend to visit and organize them in the most efficient manner. If you do not have this type of program, get out a Mapsco or go on Google Maps and locate each property. With either method, then devise a written plan for your day so that you can add notes to each address progressively as you visit each property.
- Have the right Equipment – Having certain pieces of equipment with you will insure you are able to adequately access the property and remember it later. These pieces of equipment include:
- Digital Camera – Having photographs of the properties will greatly improve your ability to recall important details you saw during the physical property evaluation. Use the camera to take photos of the front, roof, sides and back of the house, if accessible. Take close up photos of any imperfections you notice if you can do so legally. Remember, these are private properties and the fact that the property is on the Sheriff’s Sale List does not give you a legal right to trespass. However, nothing is stopping you from taking photos from the street or alley.
- Binoculars – Binoculars can be helpful if the property is occupied. Roofs, for example, may look fine when viewed with the naked eye, but a closer look with a pair of binoculars may reveal curling corners of shingles which would indicate a roofing need. Because roofing is one of the major home repair expenses, learning about these before bidding is extremely advantageous!
- Appraisal Checklists – Before you leave the house, print your appraisal checklist for each property you intend to view and label each with the property address. Appraisal checklists should include anything you can observe from the outside of the property and should also include all information you have gathered about the property up until this point. If you have filled out all the pertinent information about the property before you begin, you will be able to assess the property in consideration of this information. For example, if you are viewing a home of approximately 1500 square feet that has roofing problems, you may assess this property differently if it has a taxable value at $150,000 and boasts five bedrooms versus a taxable value of $50,000 and only two bedrooms. The five bedroom property has a lot higher value as a rent home, so you may be more willing to complete additional repairs on that home.
Organization and having the right equipment will insure your ability to assess your properties successfully. Once you have completed your property’s evaluation of each home, you will be ready to create Real Estate Comparables for the final stage of your assessment.