Classifying a neighborhood by “type”, or what many investors refer to as a “grade”, is typically nothing more than a subjective description. Although most people will have a general idea of what is being referred to, in my experience it is usually nothing more than a qualitative rather than quantitative description.
Once you have a property under contract and you’ve performed an inspection, it’s time for your loan officer to secure a purchase appraisal.
Be aware that an appraisal will almost always render a lower value than you determined in your comparative market analysis, for a number of reasons. Appraisals do not give an accurate market value – they simply give you a reflection of what you’re trying to accomplish with the bank. There are actually different types of appraisals, and each one serves a different purpose.
