Appraisal myths debunked
Legally, a real estate appraiser is required to be state certified to write substantiated real estate appraisals for federally-related transactions. You are also entitled by law to receive a copy of the completed appraisal report from your lending agency. Contact us if you have any concerns about the appraisal procedure.
Myth: Assessed value should be similar to to market value.
Fact: It is probable that Texas, like most states, validates the idea that the assessed value is the same as the market value; however, this certainly varies based on state-to-state. Examples include when interior reconstruction has occurred and the assessor does not know about the improvements, or when homes in the area have not been reassessed for an extended period.
Myth: The value of a property will differ depending upon if the appraisal is ordered for the buyer or the seller.
Fact: There is no personal interest on the part of the appraiser in the outcome of the analysis, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is written.
Myth: Any time market value is established, it should be similar to the replacement cost of the home.
Fact: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a particular home, with neither being under undue influence to buy or sell. If the house were reconstructed, the dollar amount necessary to do so would make up the replacement cost.
Myth: There are specific ways that appraisers use to determine the cost of a property, like the price per square foot.
Fact: Appraisers make an exhaustive analysis of all factors pertaining to the worth of a house, including its location, condition, size, proximity to facilities and recent opinion of value of comparable houses.
Myth: In a robust economy - when the prices of houses in a given neighborhood are reported to be rising by a particular percentage - the values of individual homes in the area can be expected to increase by that same percentage.
Fact: All appreciation of value is on a case-by-case basis, determined by information on relevant elements and the data of comparable properties. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Brazoria County or Pearland, TX?Contact us
Myth: You can commonly find what a house is worth simply by looking at the outside.
Fact: Property value is concluded by a number of factors, including location, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from simply viewing the property from the exterior.
Myth: Because the consumer is the one who provides the money to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Fact: Legally, the document is owned by the lending agency unless the lender releases their interest in the appraisal. Home buyers must be supplied with a version of the report through request because of the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the appraisal so long as it meets the needs of their lending agency.
Fact: Only if home buyers read a copy of their appraisal 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 wealth of data contained in an appraisal report that should 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 hire an appraiser is if a property needs its cost assessed in a lender-based sales transaction.
Fact: Hiring an appraiser can fulfill a variety of requirements depending on the designations and certifications of the appraiser involved; appraisers can perform a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You shouldn't need to get an appraisal if you have had a home inspection.
Fact: A home inspection report serves a completely different purpose than an appraisal. The purpose of the appraiser is to conclude an opinion of value in the appraisal process and through creating the report. House inspectors will write a report that will determine the condition of the house and its major components and possible damage.