Most Washingtonians understand that the state’s divorce laws require all marital property to be treated as community property, that is, the couple’s “marital assets” must be split equally. One of the most important issues in any Washington divorce is determining the accurate value of marital assets so that the final division is accurate.
For most couples, the family home is the most valuable marital asset, and an accurate determination of its value is a crucial step in accurately determining the value of marital assets. While some couples choose to argue about the value of the homestead, other couples and their attorneys understand the wisdom of retaining a professional appraiser.
What does an appraiser do?
An appraiser’s job is to determine the fair market value of the property that a willing buyer will pay to a willing seller. This opinion as to fair market value can be used in two ways: the divorcing couple can use the estimate of value as the basis for an agreement on how to split their assets, or the couple can use the appraisal as the basis for negotiating the sale of the residence to a third party. In the second case, the net value of the homestead (sale price less balance due on a mortgage loan) is then divided equally between the parties.
How does an appraiser form an opinion regarding value?
After being retained, the appraiser’s first job is to inspect the property to be appraised (usually called the “subject”). The appraiser conducts a physical inspection of the subject, carefully measuring the size of the rooms, noting any special features (such as a modernized kitchen or family room), and observing the physical condition of the property. The appraiser will note whether the house has been properly maintained or whether it needs significant repairs before it can be sold. The appraiser also tours the neighborhood in which the subject is located.
The appraiser next consults public records of recent property sales and looks for sales of comparable properties. The appraiser will adjust the prices paid for these comparable properties according to whether they are larger or smaller than the subject. The appraiser will also consult the local real estate market to form an opinion as to value.
The opinion as to value
The appraiser prepares a written report containing the opinion as to fair market value. This report lists the features of the subject and contains summaries of the value of the comparable properties used to reach a final opinion as to value. The report is usually given to the client and to the judge. The report may also be shared with the other party.
Getting an attorney’s recommendation on the best appraiser
Virtually all professional appraisals in Bellevue and Kirkland follow the Uniform Standards of Professional Appraisal Practice. An experienced divorce attorney can provide detailed advice on choosing an appraisal and the details of the appraisal process.