Myth: The value that is assessed 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 happened and the assessor has not seen the improvements, or when homes in the area have not been reassessed for an prolonged period.
Myth: The buyer or the seller may have impact in the value of the home depending upon for whom the appraiser is working.
Reality: The appraiser has no vested interest in the result of the appraisal report and should conduct his job with independence, objectivity and impartiality - no matter for whom the appraisal is provided.
Myth: The replacement cost of the property should be on par with the market value.
Reality: Market value is derived from what a willing buyer would likely pay a willing seller for a specific house, with neither being under pressure to buy or sell.
The replacement cost is the dollar amount required to reconstruct a home in-kind.
Myth: There are specific ways that real estate appraisers use to show the value of a house, like the price per square foot.
Reality: An appraisal report is an assertion of data concluded from the home's size, location, proximity to some facilities, the condition of the home and the values of recent comparable sales. You can rely on Precision Appraisal & Review's appraisers to be forthright in assessing this data.
Myth: In a strong economy - when the prices of properties in a given region are reported to be appreciating by a particular percentage - the values of individual properties in the area can be expected to increase by that same percentage.
Reality: All increase of value is on a case-by-case basis, determined by data on relevant considerations and the data of comparable homes.
It makes no difference if the economy is powerful or poor.
Myth: The home's exterior is determinate of the expected price of the home; there is no need to do an interior appraisal.
Reality: House value is concluded by a multitude of variables, including location, condition, improvements, amenities, and market trends.
An exterior inspection definitely can't provide all of the information needed.
Myth: Considering that the consumer is the party who puts up 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 vestment in the report, it is legally owned by the lending company that ordered the appraisal.
However, consumers have to be given a copy of the appraisal upon written request, due to the Equal Credit Opportunity Act.
Myth: There's no point for home buyers to even worry about what the report contains so long as their lender is fine with the contents therein.
Reality: Only when home buyers check out a copy of their report can they ensure its accuracy and know if they should ask questions. 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 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 estimate building values in house sales involving mortgage-lending transactions.
Reality: Based upon their qualifications and designations, appraisers can and often do perform a variety 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.
Reality: Appraisal reports are definitely not the same as a home inspection.
An appraiser decides upon an opinion of value in the appraisal process and resulting report.
The point of a home inspector is to approximate the condition of the property and its major components, then create a report on their findings.