It can be nerve-wracking to have an appraiser come out. So I wasn’t surprised to receive an email from someone worried about his vintage home. Will the appraiser give value to the vintage features? How can an owner ensure the appraiser will give proper value? Let’s talk about that.
Question: How do I get an appraiser to value these vintage features?
Answer: That’s a great question. I’m not trying to be frustrating by not answering directly in the way you might wish, but the most important thing to remember here is that value is found in the market. What do buyers prefer? Are buyers paying more for homes with vintage features or are they paying more for homes that have a vintage vibe but with modern upgrades? I find sometimes in the vintage world an owner will restore a property to its original state. I get that, but just because so much time and money was spent on a restoration does not mean the market is going to pay the same amount as a house that has been remodeled with current upgrades. In some cases buyers definitely pay for older era elements, but at the same time they tend to pay more when the kitchen is modern (and not original). I don’t say this to be offensive, but only to highlight the reality that the proof of value is found in the comps. In other words, if there is more value for being totally vintage, then an appraiser ought to be able to find similar homes that show higher prices. At the same time I get your concern because it’s easy to see blue and pink tile from the 1950s and immediately ding value because it’s outdated. This is why it’s going to be important for the appraiser to be in tune with the local market and be objective by letting the market speak rather than being shaped by his/her personal preferences. To be honest I remember in my early days coming across a Mid-Century Modern home and making the mistake of assuming the original condition was worth less when in fact it was something desirable for the market. Doh!!
Restoring a house can be very expensive, so I recommend making a detailed list for the appraiser about what has been done. This can help the appraiser understand the quality and cost of the improvements. Keep in mind if restoration is a trend in the neighborhood, it might help to mention that or even share specific examples you have seen. I’m not saying to pressure the appraiser to “hit” a certain price point (please don’t), but only highlight what is happening in the neighborhood. Personally I love hearing about what’s happening in a neighborhood from someone who lives there because it’s data for me to consider. Just remember not all the money spent on a restoration or remodel will show up in the value (it always shows up on HGTV remodels though). On a practical note you can use my appraiser information sheet if you wish.
BIG POINT: Just because something is done to a house does not mean the market is willing to pay for it. When it comes to a full vintage restoration, we have to ask if that’s something the market is willing to pay for or if it’s just one owner’s passion for yesteryear. I think of restored cars as a good example of one owner dumping a ton of money into a vehicle only to have the market pay less. I’m not saying that’s the way it always works in real estate in every case, but restoring something to its original state can be very costly and the market might not absorb that cost. The proof is in the comps though.
I hope this was interesting or helpful. Thanks Luis Sumpter for the first photo.
Questions: Have you seen the market pay more for homes that are restored to their original condition? What examples can you think of where the market did NOT pay for certain upgrades? I’d love to hear your take.
If you liked this post, subscribe by email (or RSS). Thanks for being here.
Great points, Ryan. I know one of the things I consider whenever I do homes like this is whether they are on the National Historic Registry. Homes must meet certain guidelines pertaining to the type of restoration they’ve had. Attempting to use these types of sales can help determine if the restoration does indeed add value.
Glad you mentioned that. If there is value for being on the registry, the proof will be in the sales (hopefully). 🙂 Buyers really need to know what they’re getting into with a historic area as it can be like living in a strict HOA without the HOA dues.
Last year appraised a vintage property in Yreka, 1890’s. Hand piled stone and concrete foundation. Fair quality condition good quality construction. Vintage interior or so I thought. During the inspection a contractor arrived to provide a bid on refinishing the solid wood flooring, he said that in the 1960’s his father had installed the flooring. Also said that at the same time the entire house had been updated to look similar to a “Queen Ann” style and that there was very little original to the interior.
Thanks David. Wow, that was some golden information from the contractor. I love when that happens. 🙂
Ryan, thanks for your diligent effort and your time consuming work of putting out this useful blog. I have been in the business for over 30 years as an agent and a lender. You never fail to teach me something every week.
Thank you George. You are too kind. I really appreciate it. Sometimes it’s nice to have a little encouragement, so thanks for that. 🙂
Continue to appreciate following you on Twitter and this blog.
I looked at the house featured in the first photo (Luis Sumpter photo) when it was listed, and while the owner had undoubtedly done some nice restoration of the woodwork in the entry way and dining room, that house had a ton of problems (it was leaning, there was no yard/garage, there was something weird with how an upstairs sleeping porch was screened in). I sometimes think that homeowners value restoring some beautiful wood over fixing really dramatic problems. More photos of the house on Zillow: https://www.zillow.com/homedetails/2305-Capitol-Ave-Sacramento-CA-95816/25784384_zpid/
Somebody bought it, but it was not for us.
Thanks Chris. Very cool. I appreciate the link too. I think that was actually a different house. The one I used in the picture is a current listing on P Street. The staircase and entry look very similar though, so it almost looks like just the same one.
I think you have a very valid point, which is why I appreciate your commentary. Buyers for newer homes can get distracted by the bling of granite or some other shiny object, while buyers of older homes can sometimes get distracted by some sweet woodworking (and then fail to see some real problems which could be very expensive to fix). The link you posted has some amazing woodworking – especially those ceilings. The woodworker in me is salivating… 🙂
It seems like quite a few houses in Midtown have former porch areas that have been turned into living area of sorts. I just saw something very similar like you described. It still feels like a Laundry Room, Mud Room, or Utility Room, but it’s screened in.
I hope you found something else. Or if you haven’t, hopefully something will come to the market soon. 🙂
Thanks again Chris.
Thank you for the post Ryan. Many times I’ve come across properties that look like maybe they could use some updating in the photos, but grinding those sales along with my other comparable sales showed that the market paid more than a home with modern updates. Phone calls with the agents, along with targeted questions, will help the appraiser draw a line between updated and condition on properties like these. Interviews will also help the appraiser understand what the buyers are thinking and how those buyers might have seen the subject property.
Fantastic. Good stuff Gary. I think you are spot on. We have to let the market speak, which means we have to pay attention, have conversations, and ask the right questions.
I recall a home being purchased and the owner was going to do a 400-600K restoration on it. Though the home could have easily been flipped for 150-200K. In this case the owner’s passion for restoration was not consistent with the market’s expectations for what would sell at top dollar. But as long as the owner is happy…
Great points Ryan! The market is the biggest indicator of value and while it can be tough to accept, can actually also inform a home seller on what to focus on when selling their home.
Thanks Dan. Well said. It’s not always easy to accept the market.