Key Areas Appraisers Look at During a Home Appraisal

East Coast Appraisal Service • February 28, 2022

If you plan to refinance or sell your home, you should first determine its fair market value. Then, property appraisals are an opportunity for an appraiser to check your home's quality, condition, amenities, location, and other special features that affect its value. Read on to learn some of the key areas appraisers investigate in a home appraisal.

Location

Appraisers assess your home in proximity to basic amenities such as schools, hospitals, police posts, and shopping centers. For instance, if your home location has the above amenities, the value is likely higher than homes located farther away.

Another important consideration in respect to location is the value of other homes within your neighborhood.

Size

The size of the home and lot are important factors. Since most people prefer large-sized properties, a bigger size comes into play during evaluation. In addition, the more bathrooms and bedrooms your house has, the more worth you can expect, especially if these rooms are big and accommodative.

Your home's square footage is a great determinant of the home's appraised value. Buyers love an opportunity to expand, and most of them would prefer a property that allows expansion.

Market Trends

Market conditions determine your home's value at any given time. The prices fluctuate with changes in demand and supply. If there are many houses for sale in your area and the demand is low, your home's worth may decrease. If you are not in a hurry to sell, you could wait for the market to heat up.

Interest rates and mortgage markets affect how many prospective buyers eye your home. Lower rates and mortgages attract more buyers and expand the demand, which increases prices.

Exterior and Layout

Exterior components such as walls, the foundation, and the roof play a major role in the reliability and functionality of your home. Any defects in construction and damage to the components mentioned above reduce your home's value. Issues with the roof and foundation may make a home inhabitable; thus, the appraiser pays keen attention to these.

Your home's layout plays a major role in appraisal since it is what the appraisers notice first when they arrive at your home. The value is likely higher if the layout flows well and offers convenience for new projects.

Renovations and Improvements

Your home's value doesn't end after its original construction. Any quality improvements increase the appraised value. For example, newer kitchen appliances can add years to your kitchen's life, and buyers and lenders will find your home more desirable.

Ensure any renovations you make add to the utility and comfort of your home for a higher value. You should also note that upgrades do not reflect the full value you have paid. For example, if you spent $30,000 on custom improvements, that does not necessarily increase the value of your house by $30,000. However, you should keep receipts and documentation as evidence.

General Conditions

General details, such as the physical aspects, conditions, and materials used for construction, impact durability and habitability. If your home has signs of neglect, you will earn a lower appraisal since many buyers don't want to invest in poorly maintained properties.

Basic maintenance issues negatively influence the appraisal valuation. For instance, appraisers note issues such as water leaks, peeled paint, or broken door handles. If you don't keep up with regular maintenance, the value of your home may dip even when in a good location.

Now that you know some of the factors appraisers look for, prepare your home to increase its value in the next appraisal. If you want excellent appraisal services, contact East Coast Appraisal Service today.

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What Is an IRS Step-Up Appraisal? A Plain-English Guide

May 28, 2026

When someone inherits property—whether it’s real estate, stocks, or other assets—one of the most important (and often overlooked) tax concepts is the “step-up in basis.” An IRS step-up appraisal is the process used to determine the fair market value of an asset at the time of the original owner’s death. That value becomes the new tax basis for the heir. Understanding how this works can save—or cost—significant money when the asset is eventually sold. What Does “Step-Up in Basis” Mean? “Basis” is essentially what an asset is worth for tax purposes. Normally, if you buy something, your basis is what you paid for it. But when you inherit property, the IRS allows that basis to be “stepped up” to the asset’s fair market value as of the date of death. Example: A parent buys a home for $100,000 decades ago At the time of their passing, the home is worth $700,000 The heir’s new basis becomes $700,000—not $100,000 If the heir sells the home for $710,000, they only pay capital gains tax on $10,000—not $610,000. That’s the power of the step-up. What Is an IRS Step-Up Appraisal? An IRS step-up appraisal is a formal valuation that establishes the fair market value of an inherited asset as of a specific date—usually the date of death. For real estate, this means a licensed appraiser evaluates: Comparable sales (comps) Property condition Market trends at that time Location and unique characteristics The result is a retrospective appraisal , meaning it determines value as of a past date, not the current market. Why Is It Important? A step-up appraisal is critical for several reasons: 1. Reduces Capital Gains Taxes Without a proper appraisal, the IRS may assume a lower basis, increasing taxable gains when the asset is sold. 2. Provides Documentation If the IRS ever questions the reported value, a professional appraisal serves as defensible evidence. 3. Helps with Estate Planning and Reporting Executors and heirs need accurate values for estate filings and distribution decisions. When Do You Need One? You typically need a step-up appraisal when: You inherit real estate and plan to sell it The estate did not already establish a value for tax purposes Significant time has passed since the date of death There’s potential for IRS scrutiny (high-value assets) Even if you don’t plan to sell immediately, getting the appraisal early can prevent headaches later. Date of Death vs. Alternate Valuation Date Most step-up appraisals use the date of death as the valuation date. However, in some cases, the estate may elect an alternate valuation date (six months later), if it reduces estate taxes. This decision is usually made by the estate’s executor in consultation with tax professionals. What Makes a Good Step-Up Appraisal? Not all appraisals are equal—especially when dealing with the IRS. A reliable step-up appraisal should: Be completed by a state-licensed or certified appraiser Follow Uniform Standards of Professional Appraisal Practice (USPAP) Clearly state it is a retrospective appraisal Include strong comparable sales data from the relevant time period Be well-documented and defensible Common Mistakes to Avoid Using current market value instead of date-of-death value Relying on informal estimates (like Zillow) Waiting too long to gather historical data Failing to get an appraisal at all These missteps can lead to disputes or higher taxes. Final Thoughts An IRS step-up appraisal might not be the first thing on your mind after inheriting property, but it plays a major role in determining future tax liability. Getting it right can mean the difference between a manageable tax bill and a costly surprise. If you’ve inherited property—or expect to—it’s worth consulting with a qualified appraiser and tax advisor early in the process. A little diligence upfront can protect you financially down the road.