Common myths about appraising
It is mandated by legal agencies that an appraiser is required to be state-licensed to offer appraisals for federally-supported property transactions in Texas. You are also entitled by law to request a copy of the completed appraisal from your lending agency. Contact us if you have any concerns about the appraisal process.
Myth: Market value must be similar to the assessed value of the property.
Fact: While most states back the idea that assessed value approximates estimated market value, this generally is not the case. Interior reconstruction that the assessor is not aware of and a lack of reassessment on nearby properties are exact examples of why there might be a differential in price.
Myth: The opinion of value of a home will change depending upon whether the appraisal is provided for the buyer or the seller.
Fact: The cost of the home does not affect the pay of the appraiser; due to this, the appraiser has no pressured interest in the opinion of value of the property. This means that he will complete his business with impartiality and independence regardless for whom the appraisal is produced.
Myth: Market value will approximate replacement cost.
Fact: The way market value is arrived at is based on what a home buyer would be willing to pay a willing seller for a home without being under duress from any external party to purchase or sell. Replacement value is the dollar amount necessary to rebuild a home in-kind.
Myth: Specific methods, like the price per square foot of the property, are what appraisers use to ascertain the price of a house.
Fact: Appraisers complete an exhaustive analysis of all factors in consideration to the price of a property, including its location, condition, size, proximity to facilities and recent worth of comparable homes.
Myth: When the economy is strong and the cost of houses are found to be increasing by a certain percentage, the other properties in the area can be expected to rise based on that same percentage.
Fact: Any price at which an appraiser concludes concerning a specific home is always personalized, based on certain factors pulled from the information of comparable properties and other specifications within the home itself. It doesn't matter if the economy is on the rise or declining.
Have other questions about appraisers, appraising or real estate in Brazoria County or Pearland, TX?Contact our professional staff
Myth: You can commonly find what a house is worth simply by looking at the exterior.
Fact: Home value is concluded by a multitude of variables, including area, condition, improvements, amenities, and market trends. An outside-only inspection definitely can't provide all of the data required.
Myth: Since you're the one coughing up the cash for the appraisal when applying for your loan to buy or refinance your house, you own the provided appraisal report.
Fact: The report is, in fact, legally owned by the lender - unless the lender "releases its interest" in the appraisal. Under the Equal Credit Opportunity Act, any consumer demanding a copy of the appraisal report must be provided with it by their lender.
Myth: There's no need for consumers to even concern themselves with what the report contains so long as their lender is satisfied.
Fact: It is very important for home buyers to peruse a copy of their appraisal report so that they can double-check the accuracy of the document, in case it's required to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes an invaluable record for future reference, containing useful and often-revealing data - including 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.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the worth of a property during a sales transaction involving a lender.
Fact: Based upon their qualifications and designations, appraisers can and do perform a multitude of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A house inspection serves the same purpose as an appraisal.
Fact: Appraisal reports are definitely not the same as a home inspection report. The purpose of the appraiser is to form an opinion of value in the appraisal process and through creating the report. House inspectors will write a report that will explain the condition of the house and its major components and possible damage.