Why should you have a recent appraisal of your property?

Given that we are currently in the hurricane season, one of the main reasons to have an up-to-date appraisal of your property (home or business property) is that many insurance companies want (require) recent appraisals. In our experience, most of the time, Citizens Insurance Company will require a recent appraisal before they will insure your property as a new insured.

This type of appraisal would be for “Insurable Value” and it should indicate the total replacement cost of the improvements. In addition, the appraiser should provide you with an accurate sketch of the building(s) and plenty of pictures showing what you have in terms of the existing improvements. In addition, if your property is on a barrier island, most appraisers should recognize that it cost more to construct improvements on barrier islands because of higher transportation and labor costs. Improvements that are located in areas with tendencies for high winds typically cost more to build.

 In flood plane areas there is the 50% Rule where you are prohibited to build where the cost will exceed 50% of the market value of the current improvements, thus this could be a good reason to have your property appraised. Many times, market value appraisals are required for estate purposes. There may be a recent death and the appraisal would be completed as of the date-of-death of the person that owns the estate. Many times appraisals a completed for divorce purposes where the two parties cannot agree on the current value of the improvements. Finally, most lenders, including private lenders, will require an appraisal before they will loan on a property.