Common myths about appraising
By law, an appraiser must be state-licensed to produce appraisals for federally-supported transactions. The law allows you to receive a copy of your finished appraisal report from your lender after it has been produced. Contact us if you have any concerns about the appraisal procedure.
Myth: Assessed value generally will be equal to market value.
Fact: This is not often the case; most states do support the idea that the assessed value is the same as market value, but not always. At times when interior remodeling has been done and the assessor is has not investigated the improvement or properties in the Weston/Ft. Lauderdale have not been reassessed for quite some time, it may vary wildly.
Myth: The buyer or the seller will have an influence in the value of the property depending upon for whom the appraiser is working.
Fact: The cost of the house does not affect the pay of the appraiser; due to this, the appraiser has no vested interest in the worth of the house. This means that he will render job with impartiality and objectivity regardless for whom the appraisal is provided.
Myth: Market value should equal replacement cost.
Fact: Without any pressure from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. If the property were reconstructed, the dollar amount required to do so would set the replacement cost.
Myth: There are certain methods that appraisers use to show the opinion of value of a home, such as the price per square foot.
Fact: There are many numerous calculations that an appraiser will use to make a comprehensive analysis of every factor pertaining to the property, such as the size, location, condition, how close it is to undesirable facilities and the sales price of recently sold comparable homes.
Myth: When the economy is on the rise and the worth of homes are reported to be appreciating by a certain percentage, the other homes in the vicinity can be expected to increase based on that same percentage.
Fact: Price appreciation of a specific house is always determined on an individualized basis, factoring in data on comparable houses and other relevant specifications within the home itself. It makes no difference if the economy is powerful or bad.
Have other questions about appraisers, appraising or real estate in Broward County or Weston/Ft. Lauderdale, FL?Contact us
Myth: Just seeing what the house looks like on the outside gives a good idea of its cost.
Fact: To determine an accurate worth beyond all doubt, an appraiser must examine the house on a variety of factors based on location, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from simply inspecting the property from the outside.
Myth: Since the consumer is the person who provides the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal belongs to them.
Fact: Legally, the appraisal is owned by the lending company unless the lender releases their interest in the report. However, consumers must be supplied with a copy of the report upon written request, because of the Equal Credit Opportunity Act.
Myth: It doesn't concern consumers what's in the appraisal so long as it satisfies the needs of their lender.
Fact: It is almost imperative for home buyers to read a copy of their appraisal report 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 a wealth of information stored in an appraisal report that will probably 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 proximity.
Myth: There is no reason to order an appraisal unless you are trying to get an estimate of the price of a house during a sales transaction involving a lender.
Fact: Hiring an appraiser can fulfill a variety of requirements depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude 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: An appraisal report does not fulfill the same purpose as an inspection. The appraiser decides upon an opinion of value in the appraisal process and resulting appraisal. The job of a home inspector is to assess the condition of the home and its main components, then provide a report on these conclusions.