Appraisal myths & facts

Legally, a real estate appraiser must be state certified to create substantiated appraisal reports for federally-backed sales. The law gives you the right to receive a copy of your finished report from your lender after it has been provided. Contact Appraisal Services of Brandon, Inc . if you have any questions about the appraisal procedure.

Myth: Assessed value should be the same as to market value.

Fact: This usually isn't true; most states do support the concept that the assessed value is the same as market value, but not always. Examples include when interior reconstruction has happened and the assessor does not know about the improvements, or when properties in the vicinity have not been reassessed for an prolonged period of time.

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

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

Myth: Any time market value is established, it should equal the replacement cost of the property.

Fact: Market value is based on what a willing buyer would be interested in paying a willing seller for a certain property, with neither being under pressure to buy or sell. If the house were reconstructed, the dollar amount needed to do so would form the replacement cost.

Myth: Appraisers use a calculation, such as a certain price per square foot, to come to the value of a property.

Fact: There are many varied processes that an appraiser will use to make a full analysis of every factor in consideration of the house, such as the size, location, condition, how close it is to undesirable facilities and the value of recently sold comparable properties.

Myth: As homes appreciate by a specific percentage - in a robust economic state - the houses nearby are figured to increase by the same amount.

Fact: Any value at which an appraiser arrives in regards to a particular house is always individualized, based on certain factors pulled from the data of comparable properties and other considerations within the property itself. This is true in excellent economic times as well as poor.

Myth: You can generally tell what a house is worth simply by looking at the outside.

Fact: There are a multitude of different factors that determine property value; these factors include area, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from simply inspecting the home from the exterior.

Myth: Because the consumer is the party who puts up the capital to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal belongs to them.

Fact: The report is, in fact, legally owned by the lender - unless the lender "relinquishes its interest" in the report. By the Equal Credit Opportunity Act, any consumer demanding a copy of the appraisal report must be provided with it by their lending company.

Myth: Home buyers need not be concerned with what is in their document so long as it meets the requirements of their lending agency.

Fact: It is a very good idea for home buyers to look at a copy of their appraisal so that they can verify the accuracy of the document, in case it's required to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can double as a record for the future, containing an incredible amount of data - including, but certainly 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.