Appraisal myths & facts
Legally, an appraiser is required to be state certified to write legitimate real estate appraisals for federally-related purchase. The law gives you the right to acquire a copy of your completed appraisal from your lending agency after it has been produced. Contact us if you have any questions about the appraisal process.
Myth: Market value will be equivocal to the assessed value of the property.
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. Interior reconstruction that the assessor is unaware of and a dearth of reassessment on nearby homes are exact examples of why the price can vary.
Myth: The opinion of value of a property will differ depending upon if the appraisal is ordered for the buyer or the seller.
Fact: There is no vested interest on the part of the appraiser in the outcome of the appraisal, therefore he will complete his work with impartiality and independence, no matter for whom the appraisal is ordered.
Myth: Market value will be the same as replacement cost.
Fact: Market value is derived from what a willing buyer would likely pay a willing seller for a specific home, with neither being under duress to buy or sell. The replacement cost is the dollar amount necessary to reconstruct a home in-kind.
Myth: Specific methods, such as the price per square foot of the property, are what appraisers use to arrive at the value of a home.
Fact: Appraisers complete an exhaustive analysis of all factors pertaining to the worth of a house, including its location, condition, size, proximity to facilities and recent sale prices of comparable houses.
Myth: In a strong economy - when the sales prices of homes in a given area are reported to be rising by a particular percentage - the costs of individual properties in the vicinity can be expected to increase by that same percentage.
Fact: Cost increase of a specific property is always concluded on a case-by-case basis, factoring in information on comparable properties and other relevant considerations. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Randall County or Amarillo, TX?Contact Anderson Appraisal, LLC
Myth: Just looking at what the property looks like on its exterior gives an excellent idea of its cost.
Fact: To find an accurate value beyond all doubt, an appraiser must inspect the house on a variety of factors based on area, condition, improvements, amenities, and current market trends. An outside-only inspection obviously can't provide all of the data necessary.
Myth: Since you're the one funding for the appraisal report when applying for your loan to purchase or refinance your house, you own the provided appraisal.
Fact: Unless a lending agency releases its vestment in the document, it is legally owned by the lending agency that ordered the appraisal. However, home buyers must be supplied with a copy of the document upon written request, under the Equal Credit Opportunity Act.
Myth: Consumers need not worry about what is in their report so long as it meets the requirements of their lending company.
Fact: Only if home buyers examine a copy of their appraisal can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of data contained in an report that can 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: The only reason someone would order an appraisal is if a home needs its worth assessed in a lender-based sales transaction.
Fact: Based upon their qualifications and designations, appraisers can and often do provide a series of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: You shouldn't need to get an appraisal if you have had a home inspection.
Fact: An appraisal does not fulfill the same purpose as an inspection. An appraiser concludes on an opinion of value in the appraisal process and resulting report. The task of a home inspector is to approximate the condition of the property and its main components, then create a report on these inspection.