Homeowners insurance is an important way to protect your investment in the event the unthinkable happens. One of the insurance requirements is the appraisal to determine the replacement cost for your home in case of a catastrophe. This type of appraisal is often referred to as the replacement cost valuation of your home. Evolve Property Inspections will begin offering this service and will take a deeper dive into what this process means for a homeowner.
What Is a Replacement Cost Valuation and How Is It Determined?
Insurance companies use replacement cost valuations to determine how much money it would take to completely rebuild your property all over again if a catastrophe renders that necessary. They will evaluate certain property features, such as wall construction, roof construction, windows and doors, flooring, bathrooms, kitchens, bedrooms, and the pool. Details from this inspection are documented in a special software program, which then uses current market prices and other construction fees to estimate the replacement cost of the property.
What is the Difference Between Market Value and Replacement Cost?
Market value is the price at which a property could be bought or sold in the current market. This could be influenced by the property’s location and condition, as well as the current state of the real estate market. The replacement cost is the amount it would cost to rebuild a property or structure in the event of a loss and may be more or less than the market value of the property. This value considers the current costs of rebuilding the property, such as materials, labor, and code requirements, so it is equivalent to the original property.
Schedule Your Home Inspection Today
Evolve Property Inspections will soon offer replacement cost valuations in addition to all of our inspection services. We will be your partner whether you need a home inspection, commercial inspection, insurance inspection, or any other inspections we provide. Contact us today at (305) 506-8969 to request a quote or to schedule your inspection. We serve homeowners in Miami-Dade County and the surrounding areas of Kendall, Pinecrest, Coral Gables, and Broward County.