Common myths about appraising
Legally, a real estate appraiser is required to be state certified to write substantiated appraisal reports for federally-backed sales. Also by law, you have the ability to demand a copy of the completed report from your lender. Contact us if you have any questions about the appraisal process.
Myth: The value that is ascertained by the appraiser is required to be equivalent to the 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 occurred and the assessor is unaware of the improvements, or when properties in the vicinity have not been reassessed for an extended period.
Myth: The opinion of value of a property will change depending upon whether the appraisal is ordered for the buyer or the seller.
Fact: The cost of the property does not affect the salary of the appraiser; as a result, the appraiser has no personal interest in the worth of the home. This means that he will complete his services with impartiality and independence regardless for whom the appraisal is produced.
Myth: The replacement cost of the home should be is on par with the market value.
Fact: The way market value is found is based on what a buyer would likely pay a willing seller for a home without being under pressure from any external party to purchase or sell. The dollar amount required to reconstruct a house is what forms the replacement cost.
Myth: Appraisers use a formula, like a specific price per square foot, to conclude the worth of a house.
Fact: An appraisal report is an amalgamation of information based on the home's size, location, proximity to some facilities, the condition of the property and the worth of recent comparable sales. You can rely on Young Appraisal Company, Inc.'s staff to be ethical in assessing this data.
Myth: As homes appreciate by a certain percentage - in a strong economy - the homes nearby are expected to increase by the same amount.
Fact: Price appreciation of a certain home is always concluded on an individualized basis, factoring in information on comparable houses and other relevant elements. It makes no difference whether the economy is good or on the decline.
Have other questions about appraisers, appraising or real estate in Tarrant County or North Richland Hills, TX?Contact Young Appraisal Company, Inc.
Myth: The home's outside is determinate of the actual price of the property; there is no need to do an interior inspection.
Fact: There are a number of different factors that determine the value of a home; these factors include area, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from just viewing the home from the exterior.
Myth: Considering that the consumer is the one who puts up the funding 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 lending company - unless the lender "releases its interest" in the appraisal. However, home buyers have to be supplied with a copy of the appraisal report upon written request, under the Equal Credit Opportunity Act.
Myth: Home buyers need not worry about what is in their report so long as it exceeds the needs of their lending group.
Fact: Only if home buyers look at a copy of their appraisal report can they double-check 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 wealth of data contained in an report that should be useful to the consumer 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: There is no reason to order an appraisal unless you are trying to get an estimate of the cost of a home during a sales transaction involving a lending company.
Fact: Based upon their qualifications and designations, appraisers can and may perform a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: There's no reason to get an appraisal if you have had a home inspection.
Fact: An appraisal report does not serve the same purpose as an inspection report. The appraiser forms an opinion of value in the appraisal process and resulting appraisal report. The point of a home inspector is to determine the condition of the property and its major components, then compose a report on their findings.