Myth: The value that is ascertained by the appraiser must be exactly the same as the market value.
Reality: This is not often the case; 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 been done and the assessor is not aware of the improvement or properties in the Spokane have not been reassessed for a good length of time, it may vary widely.
Myth: The buyer or the seller will have some pull in the cost of the house depending upon for whom the appraiser is working.
Reality: There is no real interest on the part of the appraiser in the outcome of the report, therefore he will conduct his work with impartiality and independence, no matter of for whom the appraisal is created.
Myth: Market value should mirror replacement cost.
Reality: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a certain house, with neither being under duress to buy or sell.
The dollar amount needed to reconstruct a property is what forms the replacement cost.
Myth: Appraisers use a calculation, like a certain price per square foot, to conclude the value of a home.
Reality: There are many different methods that an appraiser will use to make a comprehensive analysis of every factor pertaining to the property, such as the size, location, condition, how close it is to certain facilities and the sales prices of recently sold comparable homes.
Myth: When the economy is strong and the sales prices of houses are found to be appreciating by a certain percentage, the other properties in the vicinity can be expected to increase based on that same percentage.
Reality: All appreciation of value is on a case-by-case basis, determined by data on relevant conditions and the data of comparable properties.
It makes no difference if the economy is strong or poor.
Myth: The house's exterior is determinate of the actual value of the house; there is no need to do an interior inspection.
Reality: House value is concluded by a multitude of variables, including - but not limited to - location, condition, improvements, amenities, and market trends.
Obviously, none of these variables can be found simply by inspecting the house from the exterior.
Myth: Since you're the one paying for the appraisal report when applying for the loan to buy or refinance real estate, you own the ordered appraisal.
Reality: Unless a lender releases its vestment in the document, it is legally owned by the lending company that ordered the appraisal.
By the Equal Credit Opportunity Act, any consumer requesting a copy of the report must be provided with it by their lender.
Myth: Home buyers need not care about what is in their appraisal document so long as it satisfies the needs of their lending group.
Reality: It is almost imperative for consumers to read a copy of their 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.
An report can serve as a record for the future, containing an incredible amount of data - 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 proximity.
Myth: Appraisals are ordered only to estimate building values in home sales involving mortgage-lending deals.
Reality: Based upon their qualifications and designations, appraisers can and do perform a variety of 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.
Reality: An appraisal does not fulfill the same purpose as an inspection.
The point of an appraisal report is to find an opinion of market value during the appraisal process and the completion of the appraisal.
A home inspector analyzes the condition of the home and its major components and reports these findings.