Appraisal myths debunked
By law, an appraiser needs to be state-licensed to offer appraisals for federally-supported sales. Also by law, you are entitled to request a copy of the finished appraisal report from your lender. Contact our professional staff if you have any questions about the appraisal process.
Myth: Assessed value should always be similar to to market value.
Fact: While most states support the idea that assessed value equates estimated market value, this commonly is not the case. Generally when interior remodeling has occurred and the assessor is not aware of the improvement or properties in the Pearland have not been reassessed for a good length of time, it may vary wildly.
Myth: The buyer or the seller often will have an influence in the value of the house depending upon for whom the appraiser is working.
Fact: The appraiser has no vested interest in the outcome of the appraisal and should conduct his task with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.
Myth: The replacement cost of the house should be is on par with the market value.
Fact: Without any influence from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a specific property. The replacement cost is the dollar amount required to rebuild a house in-kind.
Myth: There are specific methods that real estate appraisers use to find the opinion of value of a home, like the price per square foot.
Fact: There are many differing ways that an appraiser will use to make a comprehensive analysis of every factor pertaining to the house, such as the size, location, condition, how close it is to undesirable facilities and the cost of recently sold comparable homes.
Myth: When the economy is on the rise and the value of homes are reported to be increasing by a certain percentage, the other homes in the area can be expected to rise based on that same percentage.
Fact: Any price at which an appraiser arrives in regards to a certain house is always individualized, based on certain factors pulled from the data of comparable houses and other specifications within the property itself. It makes no difference whether the economy is strong or terrible.
Have other questions about appraisers, appraising or real estate in Brazoria County or Pearland, TX?Contact Elite Appraisal Services
Myth: You can commonly see what a home is worth simply by looking at the exterior.
Fact: To determine an accurate value beyond all doubt, an appraiser must assess the home on a variety of factors based on location, condition, improvements, amenities, and market trends. An exterior inspection certainly can't provide all of the information necessary.
Myth: Because consumers pay for appraisals when applying for loans to buy or refinance real estate, they own their appraisal.
Fact: The report is, in fact, legally owned by the lender - unless the lender "releases its interest" in the appraisal. Due the Equal Credit Opportunity Act, any home buyer demanding a copy of the document must be provided with one by their lender.
Myth: It doesn't concern consumers what's in the report so long as it meets the requirements of their lending agency.
Fact: It is very important for home buyers to check over a copy of their appraisal so that they can verify the accuracy of the document, in case there is a need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of information stored in an report that will probably 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 area.
Myth: There is no reason to order an appraisal unless you are trying to get an assessment of the price of a home during a sales transaction involving a lender.
Fact: Ordering an appraisal can fulfill a variety of requirements depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: A home inspection serves the same purpose as an appraisal.
Fact: A home inspection report has a completely different purpose than an appraisal. The appraiser forms an opinion of value in the appraisal process and resulting report. House inspectors will compose a report that will determine the condition of the house and its major components and possible damage.