Appraisal myths & facts
By law, an appraiser is required to be state-licensed to produce appraisals for federally-supported transactions. The law gives you the right to acquire a copy of your finished appraisal report from your lending agency after it has been produced. Contact our professional staff if you have any concerns about the appraisal procedure.
Myth: Assessed value generally will be equal to market value.
Fact: While most states support the suggestion that assessed value equates estimated market value, this often is not the case. Examples include when interior remodeling has occurred and the assessor has not seen the improvements, or when homes in the area have not been reassessed for an prolonged period of time.
Myth: The value of a house will change depending upon if the appraisal is provided for the buyer or the seller.
Fact: The appraised value of the house does not affect the salary of the appraiser; as a result, the appraiser has no preconceived interest in the opinion of value of the home. This means that he will complete his task with impartiality and independence regardless for whom the appraisal is produced.
Myth: Market value will approximate replacement cost.
Fact: Without any pressure from any different parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a specific property. The dollar amount needed to reconstruct a home is what shows the replacement cost.
Myth: Certain formulae, like the price per square foot of the property, are the methods appraisers use to ascertain the value of a home.
Fact: There are many different calculations that an appraiser will use to make a comprehensive analysis of every factor pertaining to the home, such as the size, location, condition, how close it is to specific facilities and the sales price of recently sold comparable homes.
Myth: As houses appreciate by a specific percentage - in a robust economic state - the properties nearby are figured to appreciate by the same amount.
Fact: All appreciation of worth is on a one-on-one basis, found by data on relevant considerations and the data of comparable properties. It makes no difference whether the economy is robust or poor.
Have other questions about appraisers, appraising or real estate in Saint Louis County or Chesterfield, MO?Contact Levison Appraisal Company
Myth: You can generally tell what a home is worth simply by looking at the exterior.
Fact: There are a number of different factors that show the value of a home; these factors include area, condition, improvements, amenities, and market trends. Obviously, none of these factors can be derived simply by looking at the home from the outside.
Myth: Because consumers fund appraisals when applying for loans to purchase or refinance their property, they own their appraisal report.
Fact: Legally, the appraisal is owned by the lending agency unless the lender releases their interest in the document. Home buyers must be provided with a version of the report through request due to the Equal Credit Opportunity Act.
Myth: There's no reason for consumers to even care about what the appraisal contains so long as their lending agency is fine with the contents therein.
Fact: Only if consumers check out a copy of their appraisal report can they ensure 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 a great deal of data stored in an appraisal report that could be useful to the home buyer 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.
Myth: The only reason someone would order an appraisal is if a home needs its price estimated in a lender sales transaction.
Fact: Appraisers can have many varied qualifications and designations which allow them to provide a variety 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 no different than a home inspection.
Fact: Appraisal reports are nothing like a home inspection. The point of an appraisal report is to conclude upon an opinion of fair market value during the appraisal process and the production of the report. House inspectors will write a report that will express the condition of the house and its major components and possible damage.