Appraisal myths debunked
Legally, a real estate appraiser needs to be state certified to perform substantiated appraisal reports for federally-related sales. The law allows you to get a copy of your completed appraisal report from your lender after it has been provided. Contact our professional staff if you have any questions about the appraisal process.
Myth: The value that is ascertained by the appraiser must be exactly the same as the market value.
Fact: It could be that California, like most states, validates the idea that the assessed value equates to the market value; however, this certainly varies based on state-to-state. Interior reconstruction that the assessor has not investigated and a dearth of reassessment on nearby properties are perfect examples of why this occurs.
Myth: Depending on whether the appraisal is done for the buyer or the seller, the opinion of value of the house will vary.
Fact: The price of the property does not affect the pay of the appraiser; due to this, the appraiser has no vested interest in the worth of the home. What this means is he will provide business with impartiality and independence regardless for whom the appraisal is provided.
Myth: Market value should approximate replacement cost.
Fact: Market value is derived from what a willing buyer would likely pay a willing seller for a particular property, with neither being under undue influence to buy or sell. If the house were reconstructed, the dollar amount required to do so would set the replacement cost.
Myth: Specific formulae, such as the price per square foot of the property, are what appraisers use to ascertain the price of a house.
Fact: An appraisal is an amalgamation of data concluded from the property's size, location, proximity to specific facilities, the condition of the home and the cost of recent comparable sales. You can rely on Associate Appraisers of America's staff to be forthright in assessing this data.
Myth: When the economy is doing well and the value of properties are found to be rising by a certain percentage, the other houses in the vicinity can be expected to appreciate based on that same percentage.
Fact: Any cost at which an appraiser concludes in regards to a certain property is always individualized, based on certain factors found from the data of comparable houses and other considerations within the house itself. This is true in strong economic times as well as poor.
Have other questions about appraisers, appraising or real estate in Orange County or Seal Beach, CA?Contact Associate Appraisers of America
Myth: You can commonly find what a house is worth simply by looking at the exterior.
Fact: To find an accurate worth beyond all doubt, an appraiser must assess the home on a variety of factors based on location, condition, improvements, amenities, and market trends. An external inspection definitely can't provide all of the information needed.
Myth: Since you're the one paying for the appraisal when applying for the loan to buy or refinance real estate, you own the provided appraisal.
Fact: Unless a lending agency releases its vestment in the report, it is legally owned by the lending agency that ordered the appraisal. Due the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be given one by their lending agency.
Myth: It doesn't matter to consumers what's in the appraisal report so long as it meets the needs of their lending agency.
Fact: It is very important for consumers to go through a copy of their report so that they can verify the accuracy of the document, in case there is a need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of information contained in an appraisal that should be useful to the home buyer in the future, such as 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: The only reason someone would hire an appraiser is if a house needs its worth assessed in a lender-based sales transaction.
Fact: Hiring an appraiser can fulfill a variety of requirements depending on the designations and certifications of the appraiser involved; appraisers can perform a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You don't have to get an appraisal if you have had a home inspection.
Fact: An appraisal does not serve the same purpose as an inspection. The reason behind an appraisal is to arrive at an opinion of fair market value during the appraisal process and the completion of the report. The point of a home inspector is to determine the condition of the home and its main components, then create a report on these inspection.
Got a Question?
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.