Appraisal myths & facts

It is enforced by law that an appraiser is required to be state-licensed to create appraisals for federally-supported home transactions in California. The law allows you to receive a copy of your finished appraisal report from your lending agency after it has been provided. Contact our professional staff if you have any questions about the appraisal process.

Myth: Assessed value generally will be equal to market value.

Fact: While most states support the suggestion that assessed value is the same as estimated market value, this usually is not the case. Often when interior remodeling has occurred and the assessor is not aware of the improvement or other houses in the Seal Beach have not been reassessed for quite a while, it may vary wildly.

Myth: Depending on if the appraisal is produced for the buyer or the seller, the value of the house will vary.

Fact: There is no vested interest on the part of the appraiser in the outcome of the analysis, therefore he will complete his work with impartiality and independence, regardless for whom the appraisal is ordered.

Myth: Market value should be the same as replacement cost.

Fact: Without any pressure from any different parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a specific house. If the home were reconstructed, the dollar amount required to do so would make up the replacement cost.

Myth: There are certain methods that real estate appraisers use to find the opinion of value of a home, like the price per square foot.

Fact: Appraisers complete a comprehensive analysis of all factors in consideration to the cost of a property, including its location, condition, size, proximity to facilities and recent worth of comparable homes.

Myth: In a powerful economy - when the values of houses in a given county are found to be increasing by a certain percentage - the prices of individual homes in the area can be expected to rise by that same percentage.

Fact: Any worth at which an appraiser concludes in regards to a particular house is always personalized, based on certain factors pulled from the information of comparable homes and other considerations within the house itself. This is true in strong economic times as well as bad.

Myth: The property's outside is determinate of the actual worth of the house; it is unnecessary to do an interior appraisal.

Fact: To find an accurate value beyond all doubt, an appraiser must examine the house on a variety of factors based on area, condition, improvements, amenities, and market trends. An external inspection definitely can't provide all of the data needed.

Myth: Since you're the one providing the money for the appraisal when applying for your loan to buy or refinance real estate, you own the produced appraisal report.

Fact: Unless a lender releases its vestment in the report, it is legally owned by the lending agency that ordered the appraisal. However, home buyers have to be given a copy of the report upon written request, through the Equal Credit Opportunity Act.

Myth: It doesn't concern consumers what's in the appraisal report so long as it meets the requirements of their lending company.

Fact: A consumer should definitely inspect their appraisal; there might be some questions or some concerns with the accuracy of the analysis that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal report can double as a record for the future, containing an exorbitant amount of data - 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 proximity.