Myth: Market value needs to be equivocal to the assessed value of the property.
Reality: While most states support the idea that assessed value equates estimated market value, this usually is not the case.
Examples include when interior reconstruction has happened and the assessor does not know about the improvements, or when homes in the vicinity have not been reassessed for an prolonged period of time.
Myth: The buyer or the seller will have leverage in the cost of the property depending upon for whom the appraiser is working.
Reality: The appraised value of the house does not affect the payment of the appraiser; due to this, the appraiser has no preconceived interest in the price of the house. This means that he will render job with impartiality and independence regardless of for whom the appraisal is conducted.
Myth: Market value will equate to replacement cost.
Reality: The way market value is found is based on what a home buyer would be willing to pay a willing seller for a property without being under influence from any external group to buy or sell.
Replacement value is the dollar amount needed to reconstruct a house in-kind.
Myth: There are certain methods that appraisers use to find the cost of a property, like the price per square foot.
Reality: An appraisal report is an amalgamation of information concluded from the property's size, location, proximity to undesirable facilities, the condition of the home and the values of recent comparable sales. You can count on W. Eric Howard & Associates's appraisers to be professional in assessing this information.
Myth: When the economy is robust and the sales prices of properties are found to be rising by a certain percentage, the other houses in the neighborhood can be expected to rise based on that same percentage.
Reality: All increase of value is on a case-by-case basis, determined by information on relevant considerations and the data of comparable homes.
It makes no difference whether the economy is excellent or terrible.
Myth: You can generally see what a house is worth simply by looking at the exterior.
Reality: To find a definite value beyond all doubt, an appraiser must inspect the property on a variety of factors based on area, condition, improvements, amenities, and current market trends.
An exterior inspection certainly can't provide all of the data needed.
Myth: Because consumers pay for appraisals when applying for loans to purchase or refinance their property, they own their appraisal.
Reality: The appraisal is, in fact, legally owned by the lending agency - unless the lender "releases its interest" in the report.
By the Equal Credit Opportunity Act, any consumer asking for a copy of the document must be given one by their lending company.
Myth: There's no reason for consumers to even care about what the appraisal report contains so long as their lending institution is fine with the contents therein.
Reality: It is almost imperative for consumers to peruse a copy of their appraisal report so that they can double-check the accuracy of the document, in case they need to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make.
An appraisal report can double as a record for the future, containing a great deal 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 area.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the value of a house during a sales transaction involving a lending institution.
Reality: Appraisers can have many varied qualifications and designations which allow them to perform a lot of different services including - but certainly not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You don't have to get an appraisal if you get a home inspection.
Reality: A home inspection report serves a completely different purpose than an appraisal report.
The purpose of the appraiser is to conclude an opinion of value in the appraisal process and through writing the report.
House inspectors will compose a report that will explain the condition of the home and its major components and possible damage.
