Appraisal myths & facts
Legally, a real estate appraiser needs to be state certified to write legitimate real estate appraisals for federally-related sales. The law gives you the right to acquire a copy of your completed appraisal report from your lender after it has been provided. Contact our professional staff if you have any concerns about the appraisal procedure.
Myth: Market value will be equivocal to the assessed value of the property.
Fact: While most states uphold the suggestion that assessed value is the same as estimated market value, this usually is not the case. There are times when interior remodeling has been done and the assessor is has not investigated the improvement or other homes in the area have not been reassessed for quite some time, it may vary wildly.
Myth: The value of a home will differ depending upon whether the appraisal is produced for the buyer or the seller.
Fact: There is no vested interest on the part of the appraiser in the result of the analysis, therefore he will conduct his work with impartiality and independence, no matter for whom the appraisal is created.
Myth: The replacement cost of the house should be is on par with the market value.
Fact: The way market value is arrived at is based on what a home buyer would likely pay a willing seller for a home without being under duress from any outside group to purchase or sell. The dollar amount needed to reconstruct a home is what forms the replacement cost.
Myth: Appraisers use a formula, such as a certain price per square foot, to figure out the worth of a property.
Fact: There are many different ways that an appraiser will use to make a full analysis of every factor pertaining to the home, such as the size, location, condition, how close it is to specific facilities and the value of recently sold comparable houses.
Myth: When the economy is on the rise and the sales prices of homes are found to be appreciating by a certain percentage, the other houses in the neighborhood can be expected to rise based on that same percentage.
Fact: Any price at which an appraiser concludes in regards to a certain home is always personalized, based on certain factors derived from the information of comparable properties and other specifications within the home itself. This is true in excellent economic times as well as poor.
Have other questions about appraisers, appraising or real estate in New Castle County or Bear, DE?Contact our professional staff
Myth: Just seeing what the property looks like on its exterior gives an excellent idea of its worth.
Fact: To find an accurate value beyond all doubt, an appraiser must inspect the home on a variety of factors based on area, condition, improvements, amenities, and current market trends. An outside-only inspection certainly can't provide all of the data required.
Myth: Because consumers pay for the appraisal when applying for loans to purchase or refinance their property, they own their appraisal report.
Fact: Legally, the report is owned by the lender unless the lender relinquishes their interest in the appraisal. However, home buyers must be provided with a copy of the report upon written request, through the Equal Credit Opportunity Act.
Myth: There's no point for consumers to even care about what the appraisal contains so long as their lender is fine with the contents therein.
Fact: It is almost imperative for home buyers to look at a copy of their appraisal report so that they can verify the accuracy of the document, in case there is a need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of data stored 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 proximity.
Myth: The only reason someone would hire an appraiser is if a house needs its worth estimated in a lender-based sales transaction.
Fact: Ordering an appraisal can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can provide a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is no different than a home inspection report.
Fact: Appraisal reports are nothing like a home inspection report. The reason behind an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the production of the report. A home inspector determines the condition of the house and its major components and reports their findings.