Common myths about appraising
Legally, a real estate appraiser needs to be state certified to perform substantiated real estate appraisals for federally-supported transactions. The law gives you the right to get a copy of your completed appraisal from your lending agency after it has been produced. Contact us if you have any questions about the appraisal process.
Myth: The value that is assessed by the appraiser should be exactly the same as the market value.
Fact: This is not often the case; most states do support the concept that the assessed value is the same as market value, but not always. Interior reconstruction that the assessor has not investigated and a lack of reassessment on nearby houses are perfect examples of why the price can vary.
Myth: The appraised value of a home will be different depending upon whether the appraisal is conducted for the buyer or the seller.
Fact: There is no personal interest on the part of the appraiser in the result of the appraisal, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is created.
Myth: The replacement value of the property should be is on par with the market value.
Fact: Without any influence from any external parties to buy or sell, market value is what a willing buyer would pay a willing seller for a specific house. The dollar amount needed to rebuild a house is what shows the replacement cost.
Myth: There are certain ways that real estate appraisers use to determine the value of a property, such as the price per square foot.
Fact: Appraisers make a detailed analysis of all factors pertaining to the worth of a property, including its location, condition, size, proximity to facilities and recent worth of comparable houses.
Myth: In a strong economy - when the costs of properties in a given county are found to be rising by a particular percentage - the values of individual properties in the proximity can be expected to rise by that same percentage.
Fact: Any cost at which an appraiser concludes concerning a specific house is always individualized, based on certain factors found from the information of comparable homes and other considerations within the home itself. This is true in strong economic times as well as bad.
Have other questions about appraisers, appraising or real estate in Orange County or Seal Beach, CA?Contact Associate Appraisers of America
Myth: You can often see what a home is worth simply by looking at the outside.
Fact: To conclude an accurate worth beyond all doubt, an appraiser must assess the property on a variety of factors based on area, condition, improvements, amenities, and market trends. Obviously, none of these things can be derived just by inspecting the house from the exterior.
Myth: Because consumers fund appraisals when applying for loans to purchase or refinance their house, they own their 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. Under the Equal Credit Opportunity Act, any home buyer asking for a copy of the appraisal report must be given one by their lender.
Myth: It doesn't matter to consumers what's in the report so long as it meets the needs of their lending agency.
Fact: Only if consumers check out a copy of their appraisal report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes an excellent record for future reference, comprised of useful and often-revealing information - including 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: Appraisers are hired only to assess real estate property values in property sales involving mortgage-lending deals.
Fact: Appraisers can have many different qualifications and designations which allow them to perform a lot 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: You shouldn't need to get an appraisal if you have had a home inspection.
Fact: Appraisal reports have almost nothing in common with a home inspection report. The job of the appraiser is to find an opinion of value in the appraisal process and through producing the report. House inspectors will produce a report that will explain the condition of the house and its major components and possible damage.
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