Appraisal myths debunked
By law, an appraiser needs to be state-licensed to produce appraisals for federally-backed sales. The law allows you to acquire a copy of your completed report from your lender after it has been produced. Contact our professional staff if you have any concerns about the appraisal procedure.
Myth: Market value must be equivocal to the assessed value of the property.
Fact: While most states support the idea that assessed value equates estimated market value, this usually is not the case. At times when interior remodeling has occurred and the assessor is unaware of the improvement or other homes in the area have not been reassessed for quite a while, it may vary wildly.
Myth: The appraised value of a home will change depending upon if the appraisal is provided for the buyer or the seller.
Fact: The appraised value of the house does not affect the salary of the appraiser; due to this, the appraiser has no preconceived interest in the value of the home. Obviously, he will conduct services with impartiality and objectivity regardless for whom the appraisal is conducted.
Myth: Market value will equal replacement cost.
Fact: The way market value is found is based on what a buyer would be willing to pay a willing seller for a property without being under influence from any outside group to purchase or sell. Replacement cost is the dollar amount needed to rebuild a home in-kind.
Myth: There are specific ways that real estate appraisers use to show the value of a property, like the price per square foot.
Fact: Appraisers make a comprehensive analysis of all factors pertaining to the value of a house, including its location, condition, size, proximity to facilities and recent costs of comparable homes.
Myth: When the economy is strong and the cost of properties are reported to be rising by a certain percentage, the other houses in the vicinity can be expected to appreciate based on that same percentage.
Fact: Any worth at which an appraiser concludes in regards to a particular property is always personalized, based on certain factors concluded from the data of comparable homes and other considerations within the home itself. It doesn't matter if the economy is on the rise or declining.
Have other questions about appraisers, appraising or real estate in Elmore County or Montgomery, AL?Contact Mike Noble Appraisals
Myth: You can commonly tell what a house is worth simply by looking at the exterior.
Fact: Property value is determined by a number of variables, including area, condition, improvements, amenities, and market trends. An outside-only inspection obviously can't provide all of the information needed.
Myth: Since you're the one coughing up the cash for the appraisal report when applying for your loan to purchase or refinance your house, you own the provided appraisal report.
Fact: Legally, the report is owned by the lender unless the lender relinquishes their interest in the document. Home buyers have to be given a version of the document through request because of the Equal Credit Opportunity Act.
Myth: There's no point for consumers to even concern themselves with what the appraisal contains so long as their lending company is satisfied.
Fact: It is a very good idea for consumers to go through a copy of their appraisal so that they can verify the accuracy of the document, in case it's required to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of data contained in an appraisal that can be useful to the home buyer in the future, such as the legal and physical description of the property, square footage measurements, list of comparable properties in the neighborhood, neighborhood description and a narrative of current real-estate activity and/or market trends in the proximity.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the worth of a house during a sales transaction involving a lending agency.
Fact: Appraisers can have many different qualifications and designations which allow them to provide a multitude of different services including - but certainly not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You don't have to get an appraisal if you have had a home inspection.
Fact: An appraisal report does not serve the same purpose as an inspection. The task of the appraiser is to form an opinion of value in the appraisal process and through writing the report. House inspectors will compose a report that will explain the condition of the property and its major components and possible damage.