Myth: Assessed value generally will be the same as market value.
Reality: While most states back the suggestion that assessed value is equal to estimated market value, this generally is not the case.
Interior reconstruction that the assessor has not investigated and a dearth of reassessment on nearby houses are perfect examples of why the price can vary.
Myth: The buyer or the seller may have impact in the value of the house 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 complete his work with impartiality and independence, regardless of for whom the appraisal is written.
Myth: Market value will be the same as replacement cost.
Reality: Market value is acquired by what a willing buyer would likely pay a willing seller for a certain property, with neither being under pressure to buy or sell.
If the home were rebuilt, the dollar amount needed to do so would set the replacement cost.
Myth: There are certain ways that real estate appraisers use to find the cost of a house, such as the price per square foot.
Reality: Appraisers complete an exhaustive analysis of all factors pertaining to the value of a house, including its location, condition, size, proximity to facilities and recent sale prices of comparable homes.
Myth: As homes appreciate by a certain percentage - in a robust economic state - the properties nearby are expected to increase by the same amount.
Reality: All increase of value is on an individual basis, concluded by information on relevant conditions and the data of comparable houses.
It makes no difference whether the economy is excellent or bad.
Myth: The home's outside is determinate of the actual value of the property; it is unnecessary to do an interior appraisal.
Reality: Home value is determined by a multitude of variables, including location, condition, improvements, amenities, and market trends.
An external inspection certainly can't provide all of the data needed.
Myth: Because the consumer is the party who puts up the capital to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal belongs to them.
Reality: Unless a lending agency releases its vestment in the document, it is legally owned by the lending company that purchased the appraisal.
Due the Equal Credit Opportunity Act, any consumer asking for a copy of the appraisal report must be provided with one by their lender.
Myth: It doesn't concern consumers what's in the appraisal so long as it meets the necessities of their lender.
Reality: It is a very good idea for consumers to look at a copy of their report so that they can double-check the accuracy of the report, in case it's required to question its accuracy. 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 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 area.
Myth: The only reason someone would order an appraisal is if a property needs its value estimated in a lender sales transaction.
Reality: Depending upon their qualifications and designations, appraisers can and often do provide a lot of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A house inspection serves the same purpose as an appraisal.
Reality: An appraisal does not serve the same purpose as an inspection.
The appraiser forms an opinion of value in the appraisal process and resulting report.
House inspectors will compose a report that will determine the condition of the house and its major components and possible damage.
