Myth: The value that is ascertained by the appraiser is required to be exactly the same as the market value.
Reality: 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 remodeling has occurred and the assessor is unaware of the improvements, or when properties in the vicinity have not been reassessed for an prolonged period.
Myth: The appraised value of a property will be different depending upon if the appraisal is conducted for the buyer or the seller.
Reality: The appraiser has no personal interest in the outcome of the appraisal report and should render his task with independence, objectivity and impartiality - no matter for whom the appraisal is written.
Myth: Market value will be the same as replacement cost.
Reality: The way market value is derived is based on what a buyer would likely pay a willing seller for a house without being under duress from any outside group to buy or sell.
The replacement cost is the dollar amount necessary to reconstruct a house in-kind.
Myth: Specific formulae, such as the price per square foot of the property, are the methods appraisers use to determine the value of a property.
Reality: An appraisal is an amalgamation of data concluded from the property's size, location, proximity to some facilities, the condition of the property and the values of recent comparable sales. You can depend on Sightes Appraisal's appraisers to be professional in assessing this data.
Myth: In a strong economy - when the values of homes in a given neighborhood are found to be increasing by a particular percentage - the values of individual houses in the vicinity can be expected to increase by that same percentage.
Reality: An increase in value of a specific home must be concluded on a case-by-case basis, factoring in information on comparable houses and other relevant considerations.
It makes no difference if the economy is robust or bad.
Myth: The property's exterior is determinate of the actual value of the house; it is unnecessary to do an interior inspection.
Reality: There are a number of different variables that show the value of a home; these factors include location, condition, improvements, amenities, and market trends.
As you can see, none of these factors can be found simply by viewing the property from the outside.
Myth: Since the consumer is the party who provides the money to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report is theirs.
Reality: Unless a lender releases its interest in the appraisal report, it is legally owned by the lending company that purchased the appraisal.
Due the Equal Credit Opportunity Act, any consumer demanding a copy of the document must be provided with it 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 agency is satisfied.
Reality: It is very important for home buyers to look at a copy of their appraisal so that they can double-check the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make.
There is an incredible amount of information contained in an appraisal 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 proximity.
Myth: The only reason someone would hire an appraiser is if a home needs its value assessed in a lender sales transaction.
Reality: Hiring an appraiser can fulfill a variety of needs depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is the same as a home inspection.
Reality: A home inspection has a completely different purpose than an appraisal report.
The point of an appraisal is to conclude upon an opinion of market value during the appraisal process and the production of the appraisal.
House inspectors will produce a report that will express the condition of the property and its major components and possible damage.