Appraisal myths & facts
It is mandated by law that a real estate appraiser is required to be state-licensed to perform appraisals for federally-related real estate transactions in California. You have the ability to receive a copy of the finished appraisal report from your lending agency. Contact us if you have any concerns about the appraisal procedure.
Myth: The value that is ascertained by the appraiser must be equivalent to the market value.
Fact: This is not often the case; most states do support the concept that the assessed value is the same as market value, but not always. Usually when interior remodeling has occurred and the assessor is unaware of the improvement or properties in the neighborhood have not been reassessed for years or more, it may vary wildly.
Myth: The buyer or the seller can have some pull in the cost of the house depending upon for whom the appraiser is working.
Fact: The appraised value of the property does not affect the payment of the appraiser; because of this, the appraiser has no pressured interest in the cost of the house. What this means is he will provide services with impartiality and objectivity regardless for whom the appraisal is provided.
Myth: Market value should equal replacement cost.
Fact: Without any suggestion from any external parties to buy or sell, market value is what a willing buyer would pay an interested seller for a specific home. If the property were reconstructed, the dollar amount necessary to do so would form the replacement cost.
Myth: There are specific methods that real estate appraisers use to determine the cost of a house, like the price per square foot.
Fact: There are many differing ways that an appraiser will use to make a comprehensive analysis of every factor in consideration of the house, such as the size, location, condition, how close it is to certain facilities and the value of recently sold comparable houses.
Myth: In a powerful economy - when the costs of properties in a given region are found to be increasing by a particular percentage - the values of individual houses in the proximity can be expected to appreciate by that same percentage.
Fact: Any cost at which an appraiser concludes concerning a particular home is always personalized, based on certain factors pulled from the information of comparable properties and other considerations within the home itself. This is true in strong economic times as well as bad.
Have other questions about appraisers, appraising or real estate in San Diego County or Escondido, CA?Contact The Appraisal Firm
Myth: You can usually tell what a house is worth simply by looking at the outside.
Fact: Home worth is determined by a number of variables, including area, condition, improvements, amenities, and market trends. Obviously, none of these factors can be derived simply by inspecting the home from the exterior.
Myth: Because consumers fund the appraisal when applying for loans to buy or refinance their property, they legally own their appraisal report.
Fact: Legally, the report is owned by the lender unless the lender relinquishes their interest in the report. Home buyers must be provided with a version of the document upon written request because of the Equal Credit Opportunity Act.
Myth: Home buyers need not worry about what is in their document so long as it satisfies the needs of their lending group.
Fact: A consumer should definitely look through their document; there might be some questions or some concerns about the accuracy of the inspection that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount 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: Appraisals are ordered only to estimate real estate property values in house sales involving mortgage-lending transactions.
Fact: Appraisers can have many varied qualifications and designations which allow them to provide a lot of different services including - but not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: An appraisal report is the same as a home inspection report.
Fact: A home inspection has a completely different purpose than an appraisal report. The purpose of the appraiser is to arrive at an opinion of value in the appraisal process and through creating the report. The purpose of a home inspector is to approximate the condition of the house and its major components, then create a report on these findings.