Appraisal myths debunked
Legally, a real estate appraiser must be state certified to create substantiated appraisal reports for federally-backed purchase. You have the ability to receive a copy of the finished appraisal from your lender. Contact Performance Appraisals Inc. if you have any concerns about the appraisal procedure.
Myth: Assessed value should equate to market value.
Fact: While most states support the suggestion that assessed value approximates estimated market value, this commonly is not the case. Examples include when interior reconstruction has happened and the assessor does not know about the improvements, or when houses in the area have not been reassessed for an extended period of time.
Myth: The buyer or the seller sometimes may have an influence in the value of the property depending upon for whom the appraiser is working.
Fact: There is no personal interest on the part of the appraiser in the result of the appraisal report, therefore he will complete his work with impartiality and independence, no matter for whom the appraisal is conducted.
Myth: The replacement cost of the property should be is on par with the market value.
Fact: Without any pressure from any outside parties to buy or sell, market value is what a willing buyer would pay a willing seller for a particular house. Replacement value is the dollar amount needed to reconstruct a property in-kind.
Myth: Specific formulae, such as the price per square foot, are the ways appraisers use to arrive at the price of a property.
Fact: Appraisers make a comprehensive analysis of all factors in consideration to the cost of a home, including its location, condition, size, proximity to facilities and recent sale prices of comparable houses.
Myth: As properties appreciate by a specific percentage - in a robust economic state - the homes nearby are expected to appreciate by the same amount.
Fact: Price appreciation of a specific property has to be concluded on an individualized basis, factoring in information on comparable houses and other relevant specifications within the property itself. It makes no difference whether the economy is robust or bad.
Have other questions about appraisers, appraising or real estate in Saint Johns County or Ponte Vedra Beach, FL?Contact Performance Appraisals Inc.
Myth: Just seeing what the home looks like on the outside gives a good idea of its value.
Fact: There are a number of different variables that show the value of a home; these factors include area, condition, improvements, amenities, and market trends. Obviously, none of these things can be found just by looking at the property from the outside.
Myth: Because consumers fund the appraisal when applying for loans to purchase or refinance their home, they legally own their appraisal report.
Fact: Legally, the appraisal is owned by the lender unless the lender relinquishes their interest in the appraisal. Because of the Equal Credit Opportunity Act, any consumer asking for a copy of the document must be provided with it by their lender.
Myth: There's no need for consumers to even worry about what the appraisal contains so long as their lending institution is satisfied.
Fact: It is almost imperative for consumers to peruse a copy of their appraisal report so that they can double-check the accuracy of the report, in case there is a need to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes an invaluable record for future reference, filled with helpful and often-revealing data - 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 proximity.
Myth: The only reason someone would order an appraisal is if a property needs its price assessed in a lender sales transaction.
Fact: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can provide a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is no different than a home inspection.
Fact: A home inspection report has a completely different purpose than an appraisal. The purpose of an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the production of the appraisal report. House inspectors will write a report that will explain the condition of the home and its major components and possible damage.