Common myths about appraising
Legally, an appraiser needs to be state certified to write legitimate appraisal reports for federally-supported purchase. The law entitles you to get a copy of your completed appraisal report from your lender after it has been produced. Contact us if you have any concerns about the appraisal procedure.
Myth: The value that is ascertained by the appraiser must be exactly the same as the market value.
Fact: It could be that Florida, like most states, validates the idea that the assessed value is the same as the market value; however, this is not always true. Examples include when interior remodeling has happened and the assessor is unaware of the improvements, or when homes in the vicinity have not been reassessed for an prolonged time.
Myth: Depending on if the appraisal is written for the buyer or the seller, the value of the house will vary.
Fact: There is no personal 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 written.
Myth: Any time market value is established, it should be the same as the replacement cost of the home.
Fact: Market value is based on what a willing buyer would be interested in paying a willing seller for a specific property, with neither being under duress to buy or sell. The dollar amount demanded to reconstruct a house is what forms the replacement cost.
Myth: Appraisers use a formula, like a specific price per square foot, to arrive at the worth of a house.
Fact: There are many numerous calculations that an appraiser will use to make a comprehensive investigation of every factor pertaining to the property, such as the size, location, condition, how close it is to certain facilities and the sales price of recently sold comparable houses.
Myth: In a strong economy - when the sales prices of homes in a given region are found to be increasing by a particular percentage - the worth of individual homes in the vicinity can be expected to increase by that same percentage.
Fact: Any price at which an appraiser arrives in regards to a particular home is always personalized, based on certain factors concluded from the information of comparable properties and other considerations within the property itself. It makes no difference whether the economy is robust or on the decline.
Have other questions about appraisers, appraising or real estate in Saint Johns County or Ponte Vedra Beach, FL?Contact Performance Appraisals Inc.
Myth: You can usually find what a home is worth simply by looking at the outside.
Fact: Property value is concluded by a number of variables, including area, condition, improvements, amenities, and market trends. As you can see, none of these things can be derived just by examining the house from the outside.
Myth: Since you're the one paying for the appraisal report when applying for your loan to buy or refinance your home, you own the produced appraisal.
Fact: The appraisal is, in fact, legally owned by the lending company - unless the lender "relinquishes its interest" in the appraisal report. Because of the Equal Credit Opportunity Act, any consumer requesting a copy of the appraisal report must be given one by their lending company.
Myth: There's no reason for consumers to even care about what the report contains so long as their lending institution is satisfied.
Fact: It is almost imperative for home buyers to look at a copy of their appraisal report so that they can double-check 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 wealth of data stored in an appraisal that will probably 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 region.
Myth: Appraisers are hired only to assess house values in property sales involving mortgage-lending transactions.
Fact: Appraisers can have many varied qualifications and designations which allow them to perform a multitude of different services including - but not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: An appraisal report is the same as a home inspection.
Fact: Appraisal reports are nothing like a home inspection. The purpose of the appraiser is to form an opinion of value in the appraisal process and through creating the report. The purpose of a home inspector is to determine the condition of the house and its major components, then create a report on their findings.