Myth: The value that is ascertained by the appraiser will be the same as the market value.
Reality: This usually isn't true; most states do support the suggestion that the assessed value is the same as market value, but not always.
At times when interior remodeling has occurred and the assessor is unaware of the improvement or other homes in the Waterbury have not been reassessed for quite some time, it may vary widely.
Myth: Depending on whether the appraisal is provided for the buyer or the seller, the appraised value of the house will vary.
Reality: There is no vested interest on the part of the appraiser in the result of the analysis, therefore he will complete his work with impartiality and independence, despite of for whom the appraisal is conducted.
Myth: Any time market value is established, it should match the replacement cost of the house.
Reality: Without any pressure from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular home.
Replacement value is the dollar amount necessary to rebuild a home in-kind.
Myth: Specific formulae, such as the price per square foot, are what appraisers use to come to the value of a home.
Reality: There are many numerous ways that an appraiser will use to make an in-depth analysis of every factor in consideration of the home, such as the size, location, condition, how close it is to undesirable facilities and the sales prices of recently sold comparable houses.
Myth: In a robust economy - when the values of houses in a given region are reported to be rising by a certain percentage - the prices of individual properties in the vicinity can be expected to appreciate by that same percentage.
Reality: An increase in value of a specific house is always determined on an individualized basis, factoring in data on comparable properties and other relevant specifications within the property itself.
It doesn't matter if the economy is doing well or declining.
Myth: Just looking at what the home looks like on the outside gives an idea of its value.
Reality: There are a number of different factors that determine property value; these factors include location, condition, improvements, amenities, and market trends.
An exterior inspection definitely can't provide all of the information required.
Myth: Because the consumer is the one who provides the capital to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report belongs to them.
Reality: The appraisal is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the report.
Due the Equal Credit Opportunity Act, any home buyer requesting a copy of the document must be provided with one by their lender.
Myth: It doesn't concern consumers what's in the appraisal report so long as it satisfies the needs of their lender.
Reality: 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 report, in case they need to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make.
Also, the appraisal report makes a valuable record for future reference, filled with helpful and often-revealing information - 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 proximity.
Myth: The only reason someone would hire an appraiser is if a house needs its value estimated in a lender-based sales transaction.
Reality: Appraisers can have many different qualifications and designations which allow them to perform a lot of different services including - but certainly not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You shouldn't need to get an appraisal if you order a home inspection.
Reality: Appraisal reports are definitely not the same as a home inspection.
The function of an appraisal is to find an opinion of market value during the appraisal process and the production of the report.
House inspectors will compose a report that will show the condition of the home and its major components and possible damage.
