Common myths about appraising
By law, an appraiser is enforced to be state-licensed to produce appraisals for federally-supported transactions. Also by law, you have the ability to receive a copy of the completed appraisal from your lender. Contact All City Appraisal if you have any questions about the appraisal process.
Myth: Market value will always be equivocal to the assessed value of the property.
Fact: While most states back the idea that assessed value equates estimated market value, this generally is not the case. Examples include when interior remodeling has happened and the assessor does not know about the improvements, or when homes in the area have not been reassessed for an extended period.
Myth: Depending on whether the appraisal is ordered for the buyer or the seller, the opinion of value of the house will vary.
Fact: The price of the property does not affect the pay of the appraiser; as a result, the appraiser has no pressured interest in the value of the home. Obviously, he will provide job with impartiality and objectivity regardless for whom the appraisal is produced.
Myth: Any time market value is established, it should equal the replacement cost of the property.
Fact: Market value is based on what a willing buyer would likely pay a willing seller for a certain house, with neither being under undue influence to buy or sell. If the house were reconstructed, the dollar amount required to do so would form the replacement cost.
Myth: There are specific ways that appraisers use to show the cost of a property, like the price per square foot.
Fact: An appraisal report is a collection of information based on the home's size, location, proximity to some facilities, the condition of the home and the value of recent comparable sales. You can count on All City Appraisal's appraisers to be professional in assessing this data.
Myth: As houses increase their worth by a certain percentage - in a strong economy - the homes around the appreciating properties are figured to increase by the same amount.
Fact: Price appreciation of a specific home is always determined on an individualized basis, factoring in data on comparable properties and other relevant considerations. This is true in strong economic times as well as poor.
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Myth: Just looking at what the home looks like on the outside gives an idea of its cost.
Fact: Property worth is determined by a number of factors, including location, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from just examining the property from the outside.
Myth: Since the consumer is the one who provides the money to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report is theirs.
Fact: Unless a lending agency releases its vestment in the report, it is legally owned by the lending company that ordered the appraisal. However, home buyers must be given a copy of the appraisal upon written request, due to the Equal Credit Opportunity Act.
Myth: Home buyers need not be concerned with what is in their document so long as it exceeds the necessities of their lending company.
Fact: A home buyer should definitely inspect their appraisal report; there may be some questions or some worries about the accuracy of the appraisal that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of information stored 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 vicinity.
Myth: There is no reason to order an appraisal unless you are trying to get an assessment of the price of a property during a sales transaction involving a lending institution.
Fact: Ordering an appraisal can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can provide a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You shouldn't need to get an appraisal if you get a home inspection.
Fact: Appraisal reports are nothing like a home inspection. The appraiser decides upon an opinion of value in the appraisal process and resulting appraisal. A home inspector assesses the condition of the building and its major components and reports their findings.