Myth: Market value has to be similar to the assessed value of the property.
Reality: It is probable that California, like most states, validates the common myth that the assessed value is no different from the market value; however, this is not often the case.
Generally when interior remodeling has occurred and the assessor is unaware of the improvement or other houses in the area have not been reassessed for quite some time, it may vary widely.
Myth: The opinion of value of a home will vary depending upon whether the appraisal is conducted for the buyer or the seller.
Reality: There is no personal interest on the part of the appraiser in the outcome of the appraisal report, therefore he will conduct his work with impartiality and independence, regardless of for whom the appraisal is conducted.
Myth: The replacement value of the property will be on par with the market value.
Reality: Market value is based on what a willing buyer would be interested in paying a willing seller for a specific property, with neither being under undue influence to buy or sell.
Replacement value is the dollar amount required to rebuild a home in-kind.
Myth: Specific methods, like the price per square foot of the property, are what appraisers use to determine the value of a property.
Reality: An appraisal is a collection of information concluded from the house's size, location, proximity to specific facilities, the condition of the home and the values of recent comparable sales. You can count on WalshStreet Appraisals's appraisers to be ethical in assessing this information.
Myth: When the economy is on the rise and the sales prices of houses are reported to be rising by a certain percentage, the other homes in the neighborhood can be expected to appreciate based on that same percentage.
Reality: Any value an appraiser reports in regards to a particular property is always individualized, based on certain factors found from the data of comparable houses and other specifications within the property itself.
It makes no difference whether the economy is excellent or poor.
Myth: The home's exterior is determinate of the expected price of the house; it is unnecessary to do an interior appraisal.
Reality: There are a multitude of different variables that conclude the value of a house; these factors include location, condition, improvements, amenities, and market trends.
Obviously, none of these factors can be found simply by inspecting the home from the exterior.
Myth: Because the consumer is the party who puts up the funding 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 releases their interest in the appraisal.
Consumers have to be supplied with a version of the document through request due to the Equal Credit Opportunity Act.
Myth: There's no point for home buyers to even care about what the report contains so long as their lending company is satisfied.
Reality: A consumer should definitely inspect their report; there could be some questions or some worries about the accuracy of the appraisal report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make.
An appraisal can serve as a record for the future, containing a great deal of data - including, but 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 area.
Myth: Appraisals are ordered only to assess house values in house sales involving mortgage-lending transactions.
Reality: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can perform a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal report is no different than a home inspection.
Reality: A home inspection report has a completely different purpose than an appraisal.
The job of the appraiser is to find an opinion of value in the appraisal process and through creating the report.
The job of a home inspector is to assess the condition of the house and its main components, then produce a report on their conclusions.