Myth: Assessed value should always be the same as market value.
Reality: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always.
Interior reconstruction that the assessor is unaware of and a lack of reassessment on nearby homes are perfect examples of why there might be a differential in price.
Myth: Depending on whether the appraisal is written for the buyer or the seller, the value of the property will vary.
Reality: There is no personal interest on the part of the appraiser in the outcome of the report, therefore he will conduct his work with impartiality and independence, despite of for whom the appraisal is conducted.
Myth: The replacement value of the house is always in line with the market value.
Reality: The way market value is arrived at is based on what a buyer would be willing to pay a willing seller for a house without being under influence from any external party to buy or sell.
If the property were rebuilt, the dollar amount needed to do so would be the replacement cost.
Myth: Appraisers use a formula, such as a specific price per square foot, to figure out the value of a property.
Reality: An appraisal report is an assertion of data concluded from the house's size, location, proximity to specific facilities, the condition of the home and the values of recent comparable sales. You can count on Walker Residential Appraisal Services's staff to be ethical in assessing this information.
Myth: In a robust economy - when the sales prices of homes in a given area are reported to be appreciating by a particular percentage - the prices of individual homes in the proximity can be expected to increase by that same percentage.
Reality: Any value an appraiser derives in regards to a particular property is always individualized, based on certain factors found from the data of comparable houses and other specifications within the house itself.
This is true in excellent economic times as well as bad.
Myth: The house's exterior is determinate of the expected price of the home; there is no need to do an interior inspection.
Reality: There are a multitude of different factors that conclude the value of a house; these factors include area, condition, improvements, amenities, and market trends.
An exterior inspection definitely can't provide all of the data needed.
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 provided appraisal.
Reality: Legally, the report is owned by the lender unless the lender releases their interest in the document.
Home buyers must be provided with a version of the document through request due to the Equal Credit Opportunity Act.
Myth: Home buyers need not care about what is in their document so long as it meets the requirements of their lending group.
Reality: It is a very good idea for home buyers to check over 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 great deal of data stored in an appraisal report 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 vicinity.
Myth: The only reason someone would order an appraisal is if a house needs its value assessed in a lender-based sales transaction.
Reality: Ordering an appraisal can fulfill a variety of needs 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 report is the same as a home inspection report.
Reality: A home inspection has a completely different purpose than an appraisal.
The purpose of the appraiser is to come to an opinion of value in the appraisal process and through writing the report.
The job of a home inspector is to find the condition of the property and its major components, then write a report on these conclusions.