Does a New Roof Affect a Home Appraisal?

Home appraisals evaluate a home’s competitive position in the real estate market. An appraiser’s opinion of value represents the culmination of a market analysis that compares one home against at least three other similar homes. Appraisers consider a home’s overall wear and tear to evaluate its effective age. As such, an old roof could negatively influence a home’s effective age, but a new roof could simply signify normal maintenance and not significantly affect a home’s appraised value.

Appraisers do not scrutinize a home for defects in the same way a home inspector does. However, if they notice maintenance issues such as a roof that needs replacing, they will weigh that as an economic factor when comparing it with other homes. An old roof puts a home at a competitive disadvantage in its real estate market. Since buyers can view a roof when they drive by a house, they may rule the house out without ever viewing its interior. Appraisers account for this type of choice by adding and subtracting value for a home’s overall condition.

Replacing a roof falls into the realm of preventative maintenance. Once the roof fails to protect a home from water damage, repair costs can mount to include interior damage. According to Mack Strickland, an appraiser in Chester, Virginia, a home that demonstrates a lack of preventative maintenance can lose 10 percent of its value. On a $200,000 home, the deferred maintenance adds up quickly to $20,000. A worn roof alone may not cause an appraiser to devalue a home, but if he notices a number of maintenance issues, they will add to the home’s overall effective age.

A home’s effective age expresses numerically the number of years an appraiser expects a home to survive, or its economic life. For example, a 75-year-old home could have an effective age of 30 years if its owner has maintained the home and upgraded it so it compares well with a new home. Upgrades, such as a new kitchen, walk-in closets and a master bathroom help the older home compete with newer homes. In contrast, a 45-year-old home that has not received proper maintenance may show an effective age of 60 years. Appraisers use the effective age to calculate a home’s depreciating value. Preventative maintenance slows the rate of depreciation.

In general, don’t replace your roof to increase your home’s value. According to LendingTree, you should expect to spend up to 3 percent of your home’s value each year on routine maintenance. If your home is older, that number could go up as you replace some of the major items, such as a roof. LendingTree recommends regular roof inspections to check for loose shingles, suggesting repairs before water can seep into your home. Asphalt shingles have a lifespan of 12 to 25 years.