5 Essential Questions to Ask Your Commercial Real Estate Appraiser for a Successful Investment

 


Purchasing commercial real estate can be a smart investment, but only if you pay the right price. Having an accurate appraisal from a qualified commercial real estate appraiser is crucial for determining a property’s true market value. When selecting an appraiser, make sure to ask these five essential questions to ensure you receive a high-quality appraisal for your potential commercial property investment.

Are you a licensed or certified appraiser?
Make sure the appraiser holds the proper credentials for your state and the type of property being valued. A state license or certification proves the appraiser has met education and experience requirements and passed exams on valuation methods and ethics. This provides assurance chosen commercial real estate appraisers follow industry standards.

What is your experience appraising similar properties?
Look for an appraiser with significant expertise valuing comparable commercial spaces in the same market. For example, if you’re purchasing retail space, choose an appraiser very familiar with evaluating retail properties in that area. Their experience leads to more accurate valuations.

What valuation methods will you use?
Reputable commercial real estate appraisers draw on multiple approaches, such as the income approach, sales comparison approach and cost approach. Ask which methods they’ll apply given the unique aspects of your property type and location. Quality appraisers defend their methodology in the final report.

Can you provide references from past clients?
Ask for two or three references from previous clients who purchased commercial real estate. Follow up with them to learn if the appraiser provided a reasonable value and clear report. Check references help confirm the appraiser’s expertise and professionalism.

What is your turnaround time?
Commercial deals may hinge on quick turnarounds, so ask how long your appraisal will take. Most lenders require appraisals within 30 days of closing. Let the appraiser know upfront about any tight timelines so they can accommodate accordingly.

Asking the right questions when selecting your commercial real estate appraiser leads to more reliable property valuations. With an accurate appraisal in hand, you can make informed investment decisions and pay a fair price, key ingredients for commercial real estate investment success. Paired with thorough financial analysis, these essential questions help set your next commercial real estate purchase up for positive returns.

Ref: https://medium.com/@vracommercialusa/5-essential-questions-to-ask-your-commercial-real-estate-appraiser-for-a-successful-investment-f0a561e7500c

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