Common myths about appraising

It is enforced by law that a real estate appraiser must be state-licensed to perform appraisal reports for federally-related home purchases in Missouri. You have the ability to demand a copy of the finished appraisal from your lending agency. Contact Levison Appraisal Company if you have any questions about the appraisal procedure.

Myth: Market value has to be equivocal to the assessed value of the property.

Fact: It could be that Missouri, like most states, validates the common myth that the assessed value is the same as the market value; however, this is not always true. Interior remodeling that the assessor has not investigated and a lack of reassessment on nearby houses are exact examples of why this occurs.

Myth: The value of a home will be different depending upon if the appraisal is provided for the buyer or the seller.

Fact: There is no personal interest on the part of the appraiser in the result of the analysis, therefore he will complete his work with impartiality and independence, regardless for whom the appraisal is ordered.

Myth: Any time market value is found, it should equate to the replacement cost of the house.

Fact: The way market value is found is based on what a home buyer would likely pay a willing seller for a home without being under pressure from any external group to buy or sell. Replacement cost is the dollar amount required to rebuild a home in-kind.

Myth: Appraisers use a calculation, such as a specific price per square foot, to conclude the value of a house.

Fact: There are many different calculations that an appraiser will use to make a detailed analysis of every factor pertaining to the property, such as the size, location, condition, how close it is to specific facilities and the value of recently sold comparable homes.

Myth: In a strong economy - when the sales prices of properties in a given region are found to be rising by a particular percentage - the prices of individual houses in the vicinity can be expected to appreciate by that same percentage.

Fact: Cost appreciation of a certain home has to be concluded on a case-by-case basis, factoring in information on comparable properties and other relevant considerations. It makes no difference if the economy is robust or terrible.

Myth: You can generally find what a home is worth simply by looking at the outside.

Fact: There are a multitude of different factors that show property value; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this data from simply looking at the house from the outside.

Myth: Because the consumer is the one who provides the funding to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal is theirs.

Fact: Unless a lending agency releases its interest in the report, it is legally owned by the lending agency that ordered the appraisal. Because of the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be given it by their lending agency.

Myth: It doesn't matter to consumers what's in the appraisal so long as it meets the needs of their lender.

Fact: It is almost imperative for home buyers to check over a copy of their report so that they can double-check the accuracy of the document, in case it's required to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of information stored 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 region.