Getting a fair Toronto real estate appraisal: a guide for Gulf-based owners

An appraisal is an independent opinion of what a property is worth, and you cannot bargain with an appraiser the way you can with an agent. What you can do is make sure the appraiser has accurate information, sees the property at its best and works from sound comparisons. If you own or are buying in Toronto from the Gulf, the same steps apply, with a few extra checks because you may not be there in person.

What an appraisal is for

Appraisals are typically requested for a mortgage or refinance, for a sale or purchase, for estate or legal reasons, or for insurance. The appraiser's client is usually the party who ordered it, often a lender, and the lender decides how to use the figure. A low appraisal can reduce how much a lender will advance, even if the price you agreed is higher. It is therefore worth treating it as a financing step, not a formality.

How appraisers reach a figure

For homes, the most common method compares the property with similar ones that sold recently nearby, adjusting for differences. Appraisers consider:

• location and the immediate street;
• lot size and shape;
• size, layout and number of bedrooms and bathrooms;
• age, construction quality and condition;
• upgrades and renovations, and whether they were permitted;
• parking, outdoor space and any view or nuisance;
• zoning and permitted use.

Only the facts that can be shown count. A kitchen renovation helps if the appraiser can see it, date it and measure it.

How to prepare

1. Collect recent comparable sales. Ask your agent for sales of similar properties in the same neighbourhood from the recent past, with size and condition noted. Give these to the appraiser if permitted.
2. Write down improvements. List renovations with dates, costs and any permits, and keep invoices.
3. Fix small visible faults. Leaking taps, broken fittings, peeling paint and damaged flooring are cheap to correct and affect the impression of condition.
4. Make the property accessible and clean. Clear clutter, open every room and basement, and ensure lights work.
5. Have documents ready. Include the survey or lot plan, property tax bill, floor plan and details of any condominium fees.
6. Be accurate. Do not overstate. If an appraiser finds an unpermitted addition or a misdescribed feature, trust in everything else you provided drops.

If you think the number is wrong

Ask for a clear explanation of which comparable sales were used and why. If you spot a factual error, such as the wrong square footage, wrong number of bedrooms or an omitted renovation, raise it in writing with evidence. You can also ask the lender whether a review is possible. Shopping around for appraisers until you get a high figure is not a sound strategy and may be refused by lenders. If you need an independent view for your own decision, commission a separate appraisal and be open about its purpose.

The Gulf-based owner or buyer

When you manage from a distance, you rely on other people for facts. Points to address:

• Use a qualified, regulated appraiser. In Canada, appraisers belong to professional bodies. Ask for their credentials and verify them with that body.
• Arrange access. Someone you trust, such as a property manager or agent, needs to let the appraiser in and answer questions accurately.
• Understand the lender's role. If you are financing with a lender who treats non-residents differently, ask early about requirements and whether the lender selects the appraiser.
• Check the market, not only the appraisal. A valuation reflects a point in time. Compare it with local sales data and with the opinion of a licensed agent before you act on it.
• Consider tax and currency. Taxes on buying, owning and selling Canadian property, and any rules for non-residents, can change. Take advice from a Canadian tax professional, and allow for exchange rate and transfer costs when comparing the figure with your own currency.
• Rental use. If the property is let, the appraiser may consider income as well as comparable sales, so keep lease details and rent records organised.

Mistakes to avoid

• Spending heavily on cosmetic upgrades shortly before the appraisal expecting a matching rise in value.
• Withholding information about problems with the property, such as water damage or structural issues.
• Relying on an online estimate as a replacement for a professional appraisal.
• Assuming the appraised value is a guaranteed sale price.

An appraisal rewards preparation more than persuasion. Accurate documents, good comparisons and a property that is visibly cared for give the appraiser what is needed to reach a figure you can defend.