Common myths about appraising
By law, an appraiser needs to be state-licensed to perform appraisals for federally-related purchases. You also have the right to demand a copy of the finished report from your lender. Contact us if you have any questions about the appraisal process.
Myth: Assessed value should equate to market value.
Fact: It is probable that Florida, like most states, supports the common myth that the assessed value is the same as the market value; however, this is not always true. At times when interior remodeling has been done and the assessor is not aware of the improvement or other houses in the neighborhood have not been reassessed for quite some time, it may vary wildly.
Myth: The buyer or the seller sometimes may have some pull in the cost of the house depending upon for whom the appraiser is working.
Fact: The appraiser has no vested interest in the outcome of the appraisal report and should conduct services with independence, objectivity and impartiality - no matter for whom the appraisal is written.
Myth: The replacement cost of the home is always is on par with the market value.
Fact: Market value is acquired by what a willing buyer would be interested in paying a willing seller for a particular house, with neither being under duress to buy or sell. The replacement cost is the dollar amount needed to rebuild a home in-kind.
Myth: Certain formulae, such as the price per square foot of the property, are what appraisers use to ascertain the value of a home.
Fact: An appraisal report is an assertion of data based on the property's size, location, proximity to certain facilities, the condition of the property and the cost of recent comparable sales. You can count on Appraisal Services of Brandon, Inc .'s staff to be honest in assessing this information.
Myth: When the economy is on the rise and the worth of houses are reported to be appreciating by a certain percentage, the other houses in the neighborhood can be expected to increase based on that same percentage.
Fact: Any value at which an appraiser arrives in regards to a particular property is always individualized, based on certain factors pulled from the data of comparable properties and other considerations within the house itself. This is true in strong economic times as well as bad.
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Myth: You can often tell what a home is worth simply by looking at the exterior.
Fact: There are a multitude of different factors that determine the value of a home; these factors include location, condition, improvements, amenities, and market trends. As you can see, none of these things can be derived just by inspecting the house from the outside.
Myth: Since you're the one coughing up the cash for the appraisal when applying for your loan to buy or refinance real estate, you own the ordered appraisal.
Fact: The document is, in fact, legally owned by the lending agency - unless the lender "releases its interest" in the document. However, home buyers must be given a copy of the appraisal upon written request, through the Equal Credit Opportunity Act.
Myth: It doesn't mean anything to consumers what's in the appraisal so long as it satisfies the needs of their lending agency.
Fact: Only if home buyers check out a copy of their appraisal report can they verify 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 an incredible amount of information contained in an appraisal that can 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 area.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the cost of a property during a sales transaction involving a lending agency.
Fact: Appraisers can have many varied qualifications and designations which allow them to provide a multitude of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: An appraisal is no different than a home inspection.
Fact: An appraisal does not fulfill the same purpose as an inspection. The purpose of an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the completion of the report. The task of a home inspector is to approximate the condition of the house and its major components, then compose a report on these conclusions.