Common myths about appraising

By law, an appraiser is required to be state-licensed to offer appraisals for federally-related transactions. You also have the right to request a copy of the completed report from your lender. Contact MacAdams Real Estate Appraisals, LLC if you have any questions about the appraisal process.

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

Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. There are times when interior remodeling has occurred and the assessor is not aware of the improvement or other houses in the area have not been reassessed for quite a while, it may vary wildly.

Myth: Depending on if the appraisal is drawn up for the buyer or the seller, the value of the property will vary.

Fact: The appraised value of the property does not affect the salary of the appraiser; because of this, the appraiser has no pressured interest in the value of the house. Obviously, he will conduct task with impartiality and objectivity regardless for whom the appraisal is created.

Myth: Any time market value is found, it should be similar to the replacement cost of the property.

Fact: Market value is derived from what a willing buyer would be interested in paying a willing seller for a certain property, with neither being under pressure to buy or sell. Replacement value is the dollar amount needed to reconstruct a house in-kind.

Myth: Appraisers use a formula, such as a certain price per square foot, to come to the value of a home.

Fact: There are many numerous ways that an appraiser will use to make a full analysis of every factor pertaining to the house, such as the size, location, condition, how close it is to specific facilities and the opinion of value of recently sold comparable houses.

Myth: When the economy is strong and the value of houses are found to be rising by a certain percentage, the other homes in the area can be expected to rise based on that same percentage.

Fact: Any worth at which an appraiser arrives in regards to a specific house is always individualized, based on certain factors derived from the information of comparable homes and other specifications within the property itself. It makes no difference whether the economy is excellent or terrible.

Myth: The house's outside is determinate of the actual worth of the house; it is unnecessary to do an interior appraisal.

Fact: Home value is determined by a number of factors, including area, condition, improvements, amenities, and market trends. There's no possible way to get all of this information from simply looking at the house from the outside.

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 appraisal is owned by the lender unless the lender relinquishes their interest in the appraisal. By the Equal Credit Opportunity Act, any consumer asking for a copy of the appraisal report must be given one by their lending company.

Myth: Consumers need not care about what is in their report so long as it exceeds the needs of their lending institution.

Fact: A consumer should definitely inspect their appraisal report; there might be some questions or some worries about the accuracy of the report that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, as it contains an exorbitant amount of information - including, but certainly not limited to 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 area.