Appraisal myths & facts
Legally, an appraiser must be state certified to write legitimate real estate appraisals for federally-supported purchase. The law gives you the right to acquire a copy of your finished report from your lender after it has been provided. Contact our professional staff if you have any concerns about the appraisal procedure.
Myth: The value that is ascertained by the appraiser is required to be the same as the market value.
Fact: While most states support the idea that assessed value is equal to estimated market value, this commonly is not the case. Examples include when interior reconstruction has happened and the assessor has not seen the improvements, or when properties in the vicinity have not been reassessed for an extended period.
Myth: The opinion of value of a home will vary depending upon whether the appraisal is conducted for the buyer or the seller.
Fact: 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 for whom the appraisal is written.
Myth: Market value should equal replacement cost.
Fact: Without any suggestion from any outside parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. If the property were rebuilt, the dollar amount needed to do so would be the replacement cost.
Myth: There are specific methods that appraisers use to show the opinion of value of a house, such as the price per square foot.
Fact: Appraisers complete an exhaustive analysis of all factors pertaining to the price of a property, including its location, condition, size, proximity to facilities and recent worth of comparable properties.
Myth: In a robust economy - when the values of houses in a given area are reported to be rising by a particular percentage - the values of individual properties in the area can be expected to appreciate by that same percentage.
Fact: Any cost at which an appraiser concludes in regards to a certain house is always personalized, based on certain factors derived from the data of comparable houses and other considerations within the home itself. This is true in strong economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Forsyth County or Kernersville, NC?Contact our professional staff
Myth: Just looking at what the property looks like on the outside gives a good idea of its cost.
Fact: House worth is concluded by a multitude of factors, including location, condition, improvements, amenities, and market trends. An outside-only inspection definitely can't provide all of the information necessary.
Myth: Since you're the one paying for the appraisal when applying for your loan to buy or refinance real estate, you own the ordered appraisal report.
Fact: Unless a lender releases its vestment in the appraisal report, it is legally owned by the lending agency that purchased the appraisal. By the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be provided with it by their lending agency.
Myth: Home buyers need not worry about what is in their appraisal so long as it satisfies the necessities of their lending group.
Fact: It is very important for consumers to look at a copy of their report so that they can verify the accuracy of the document, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal report makes a near perfect record for future reference, containing helpful and often-revealing information - including, but 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 vicinity.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the worth of a home during a sales transaction involving a lending company.
Fact: Depending upon their qualifications and designations, appraisers can and often do provide a series of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: An appraisal report is the same as a home inspection.
Fact: A home inspection report serves a completely different purpose than an appraisal report. The reason behind an appraisal is to arrive at an opinion of fair market value during the appraisal process and the production of the appraisal report. The job of a home inspector is to approximate the condition of the house and its major components, then produce a report on their conclusions.