Appraisal myths debunked
By law, an appraiser is required to be state-licensed to perform appraisals for federally-backed sales. Also by law, you are allowed to demand a copy of the finished report from your lender. Contact us if you have any concerns about the appraisal procedure.
Myth: Assessed value will always be similar to to market value.
Fact: While most states back the idea that assessed value approximates estimated market value, this often is not the case. Interior remodeling that the assessor is unaware of and a dearth of reassessment on nearby houses are perfect examples of why this occurs.
Myth: The appraised value of a home will differ depending upon if the appraisal is ordered for the buyer or the seller.
Fact: The value of the property does not affect the salary of the appraiser; due to this, the appraiser has no personal interest in the opinion of value of the property. This means that he will conduct services with impartiality and objectivity regardless for whom the appraisal is provided.
Myth: The replacement value of the house will be is on par with the market value.
Fact: The way market value is derived is based on what a buyer would likely pay a willing seller for a home without being under pressure from any outside party to purchase or sell. The dollar amount needed to reconstruct a house is what constitutes the replacement cost.
Myth: There are specific ways that real estate appraisers use to find the opinion of value of a house, like the price per square foot.
Fact: There are many numerous methods that an appraiser will use to make an in-depth analysis of every factor pertaining to the home, such as the size, location, condition, how close it is to undesirable facilities and the value of recently sold comparable homes.
Myth: When the economy is strong and the worth of homes are found to be increasing by a certain percentage, the other houses in the neighborhood can be expected to increase based on that same percentage.
Fact: All increase of value is on an individual basis, found by data on relevant elements and the data of comparable homes. It makes no difference whether the economy is powerful or bad.
Have other questions about appraisers, appraising or real estate in Maricopa County or Scottsdale, AZ?Contact our professional staff
Myth: You can generally see what a home is worth simply by looking at the outside.
Fact: To determine an accurate value beyond all doubt, an appraiser must examine the property on a variety of factors based on area, condition, improvements, amenities, and market trends. An exterior inspection obviously can't provide all of the information needed.
Myth: Because consumers fund the appraisal when applying for loans to buy or refinance their home, they legally own their appraisal report.
Fact: Unless a lending agency releases its vestment in the report, it is legally owned by the lending agency that purchased the appraisal. However, consumers must be supplied with a copy of the report upon written request, under the Equal Credit Opportunity Act.
Myth: Consumers need not be concerned with what is in their appraisal so long as it exceeds the needs of their lending agency.
Fact: A home buyer should definitely read through their appraisal; there will probably be some questions or some worries about the accuracy of the appraisal report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, as it contains an incredible amount of information - 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 proximity.
Myth: Appraisals are ordered only to assess home values in property sales involving mortgage-lending transactions.
Fact: Appraisers can have many different qualifications and designations which allow them to provide a variety of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: A house inspection serves the same purpose as an appraisal.
Fact: Appraisal reports have almost nothing in common with a home inspection report. The reason behind an appraisal report is to find an opinion of fair market value during the appraisal process and the completion of the appraisal. A home inspector analyzes the condition of the home and its main components and reports their findings.