Appraisal myths debunked

Legally, an appraiser must be state certified to create substantiated appraisal reports for federally-backed sales. You also have the right to request a copy of the completed appraisal from your lending agency. Contact us if you have any concerns 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 equal to estimated market value, this usually is not the case. Interior reconstruction that the assessor is not aware of and a dearth of reassessment on nearby properties are perfect examples of why there might be a differential in price.

Myth: The appraised value of a property will vary depending upon whether the appraisal is provided for the buyer or the seller.

Fact: The appraiser has no vested interest in the outcome of the report and should complete his job with independence, objectivity and impartiality - no matter for whom the appraisal is written.

Myth: Any time market value is found, it should be the same as the replacement cost of the home.

Fact: Without any suggestion from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a specific house. If the house were rebuilt, the dollar amount required to do so would be the replacement cost.

Myth: There are specific methods that real estate appraisers use to find the value of a property, such as the price per square foot.

Fact: There are many numerous processes that an appraiser will use to make a full investigation of every factor pertaining to the house, such as the size, location, condition, how close it is to undesirable facilities and the sales price of recently sold comparable properties.

Myth: As homes appreciate by a specific percentage - in a robust economy - the properties nearby are figured to appreciate by the same amount.

Fact: All appreciation of price is on a case-by-case basis, determined by information on relevant considerations and the data of comparable homes. This is true in excellent economic times as well as poor.

Have other questions about appraisers, appraising or real estate in Hillsborough County or Valrico, FL?

Contact our professional staff

Myth: Just looking at what the property looks like on the outside gives a good idea of its cost.

Fact: There are a number of different factors that show the value of a home; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from simply inspecting the home from the exterior.

Myth: Since you're the one coughing up the cash for the appraisal when applying for the loan to buy or refinance your house, you own the ordered appraisal report.

Fact: The appraisal is, in fact, legally owned by the lender - unless the lender "releases its interest" in the report. Consumers must be provided with a copy of the document through request because of the Equal Credit Opportunity Act.

Myth: Consumers need not care about what is in their report so long as it satisfies the needs of their lending company.

Fact: A home buyer should definitely look through their report; there will probably be some questions or some concerns with the accuracy of the appraisal report that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, containing an exorbitant amount of information - 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.

Myth: Appraisals are ordered only to assess home values in property sales involving mortgage-lending transactions.

Fact: Based upon their qualifications and designations, appraisers can and will perform a lot of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: A property inspection serves the same purpose as an appraisal.

Fact: An appraisal report does not fulfill the same purpose as an inspection report. The point of an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the production of the report. House inspectors will compose a report that will express the condition of the property and its major components and possible damage.