Housing Prices on Rebound

Tips to protect your home's value during the appraisal process.
3:00 | 09/25/12

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Transcript for Housing Prices on Rebound
And now to "real money" and the housing market. There's some positive signs the market is turning around but here is the latest number tonight on how much the bubble burst. The average american home lost more than $40,000 in value. Right now, more than 2 million americans have their homes up for sale. How do you make sure the bank appraisal of your home gets you the most money? Abc's sharyn alfonsi is on the real money beat tonight. Repor Reporter: Jessica doerres' whole family lived in this new jersey community. Then, the whole family decided to move. We all put our houses on the market at the same time, they already sold. They're gone. Reporter: But jessica and her husband, carl, are stuck in jersey. They bought the house for $325,000 six years ago. Today, they're asking $225,000. A $100,000 loss. 100,000 is -- it's real money. Reporter: What's worse, the house was just appraised at $190,000 -- $35,000 less than what they're asking. That gap could be a huge problem if they ever do get an offer. When a bank gets a low appraisal, they often won't do the loan at all because they feel as though it overvalued the house and they feel at risk. So, you can implore with the bank that they get a second look. But, the fact of the matter is, it's rarely turned around. Reporter: But could we turn it around? We brought in one of the country's top appraisal experts for the inside scoop. She let us in on three ways appraisers are sizing up your home. First, the first sight. Walking into this house we need a hatchet, right? I didn't bring my machete. This is a no no. Reporter: Appraisers can hack off thousands of dollars form your home's value for just having an unkempt yard. And insight the first sight matters too. A clean, clutter-free house can afraid higher than the same messy house. And strong subliminals. Just add a new facet adds value. It makes it look jazzier. Reporter: And finally out with the old and in with a new. An old tv can make a whole room look dated. So we got started. Moving out that busy oversized furniture. Slip covering what is left and cutting down the hedges. There's a lot to do and the next appraiser is coming down in the next few days. I left them with a list. It is seven pages long. You have 48 hours. Good look. They spent $1600 on improvements, but would it pay off? The appraiser was here and we were about to find out. Meet jake, an appraiser for 26 year he said art-art, art-science. What kind of improvements have you made to your home in the recent past? A lot. Reporter: Remember that out of control office? Now, all business. The cluttered kitchen, cleaned up. And the old facet, updated. And the living room, now spare. The old set, replaced with state of the art. But could those little changes really pay off? Remember, the last appraisal came in at $190,000. The new appraisal? Oh, good. That's a lot better. Reporter:214,000. A $24,000 increase. And they were such good sport, they did everything on that seven-page to-do list. And it paid off. We said $1600. For every dollar they spent they got $15 back on that appraisal. The first appraisal, not the final word. Good thing don't panic. And prospective buyers? They have people coming back. It's still for sale but they're

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