Myth: Assessed value will always be similar to market value.
Reality: While most states back the concept that assessed value is equal to estimated market value, this commonly is not the case.
Examples include when interior reconstruction has occurred and the assessor is unaware of the improvements, or when homes in the vicinity have not been reassessed for an prolonged time.
Myth: The buyer or the seller often will have an influence in the value of the property depending upon for whom the appraiser is working.
Reality: There is no real interest on the part of the appraiser in the outcome of the report, therefore he will conduct his work with impartiality and independence, no matter of for whom the appraisal is ordered.
Myth: The replacement value of the home is always in line with the market value.
Reality: Without any suggestion from any external parties to buy or sell, market value is what a willing buyer would pay an interested seller for a particular home.
The dollar amount needed to reconstruct a home is what forms the replacement cost.
Myth: Certain methods, such as the price per square foot of the property, are the ways appraisers use to arrive at the value of a home.
Reality: Appraisers make a comprehensive analysis of all factors pertaining to the value of a home, including its location, condition, size, proximity to facilities and recent values of comparable properties.
Myth: As houses appreciate by a certain percentage - in a robust economy - the properties nearby are expected to appreciate by the same amount.
Reality: All appreciation of value is on an individual basis, concluded by data on relevant conditions and the data of comparable properties.
This is true in robust economic times as well as poor.
Myth: You can often find what a home is worth simply by looking at the outside.
Reality: To determine a genuine value beyond all doubt, an appraiser must examine the home on a variety of factors based on location, condition, improvements, amenities, and market trends.
There's no real way to get all of this data from simply viewing the property from the exterior.
Myth: Considering that the consumer is the person who provides the money to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal belongs to them.
Reality: Legally, the report is owned by the lender unless the lender releases their interest in the document.
Home buyers have to be given a copy of the appraisal report upon written request because of the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the appraisal report so long as it satisfies the requirements of their lender.
Reality: Only when home buyers look over a copy of their appraisal report can they verify its accuracy and know if they should ask questions. Remember, this is probably the most expensive and important investment a consumer will ever make.
An report can serve as a record for the future, containing an incredible amount of data - including, but certainly not limited to 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 area.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the value of a property during a sales transaction involving a lender.
Reality: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can perform a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: A house inspection serves the same purpose as an appraisal.
Reality: An appraisal does not serve the same purpose as an inspection.
An appraiser finds an opinion of value in the appraisal process and resulting appraisal report.
House inspectors will create a report that will explain the condition of the house and its major components and possible damage.
