Myth: Market value needs to be similar to the assessed value of the property.
Reality: While most states support the idea that assessed value is the same as estimated market value, this often is not the case.
Interior remodeling that the assessor is not aware of and a lack of reassessment on nearby homes are exact examples of why there might be a differential in price.
Myth: The appraised value of a house will be different depending upon whether the appraisal is conducted for the buyer or the seller.
Reality: There is no vested interest on the part of the appraiser in the result of the appraisal report, therefore he will complete his work with impartiality and independence, regardless of for whom the appraisal is created.
Myth: The replacement cost of the property is always in line with the market value.
Reality: Market value is based on what a willing buyer would be interested in paying a willing seller for a particular house, with neither being under undue influence to buy or sell.
The dollar amount demanded to reconstruct a property is what shows the replacement cost.
Myth: Specific methods, such as the price per square foot of the property, are what appraisers use to ascertain the value of a home.
Reality: An appraisal is an amalgamation of information based on the home's size, location, proximity to some facilities, the condition of the property and the values of recent comparable sales. You can depend on Woods Appraisal, LLC's appraisers to be honest in assessing this information.
Myth: As houses appreciate by a certain percentage - in a strong economy - the homes nearby are expected to appreciate by the same amount.
Reality: An increase in value of a specific house must be determined on an individualized basis, factoring in data on comparable homes and other relevant elements.
It makes no difference whether the economy is good or bad.
Myth: The home's exterior is determinate of the expected price of the house; there is no need to do an interior inspection.
Reality: There are a multitude of different factors that show property value; these factors include area, condition, improvements, amenities, and market trends.
As you can see, none of these things can be found simply by inspecting the house from the outside.
Myth: Since the consumer is the person who provides the capital to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Reality: Legally, the report is owned by the lending agency unless the lender relinquishes their interest in the report.
Because of the Equal Credit Opportunity Act, any home buyer demanding a copy of the appraisal report must be given one by their lending company.
Myth: It doesn't matter to consumers what's in the appraisal so long as it meets the needs of their lender.
Reality: Only when home buyers read a copy of their appraisal report can they double-check its accuracy and know if they should ask questions. 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 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 area.
Myth: Appraisers are hired only to estimate house values in home sales involving mortgage-lending deals.
Reality: Depending upon their qualifications and designations, appraisers can and may perform a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: There's no need to get an appraisal if you get a home inspection.
Reality: A home inspection report serves a completely different purpose than an appraisal.
The appraiser concludes on an opinion of value in the appraisal process and resulting report.
The purpose of a home inspector is to assess the condition of the property and its major components, then provide a report on their findings.