Myth: Assessed value should always be similar to 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.
Examples include when interior remodeling has occurred and the assessor does not know about the improvements, or when homes in the vicinity have not been reassessed for an prolonged period.
Myth: The buyer or the seller may have leverage in the cost of the home depending upon for whom the appraiser is working.
Reality: The appraised value of the property does not affect the salary of the appraiser; because of this, the appraiser has no personal interest in the opinion of value of the house. Obviously, he will complete his job with impartiality and independence regardless of for whom the appraisal is provided.
Myth: Market value will mirror replacement cost.
Reality: Without any suggestion from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular property.
The dollar amount necessary to rebuild a property is what constitutes the replacement cost.
Myth: There are certain methods that real estate appraisers use to determine the opinion of value of a home, such as the price per square foot.
Reality: An appraisal is a collection of information based on the house's size, location, proximity to some facilities, the condition of the property and the values of recent comparable sales. You can rely on WalshStreet Inc.'s staff to be honest in assessing this data.
Myth: When the economy is robust and the sales prices of houses are reported to be increasing by a certain percentage, the other properties in the neighborhood can be expected to rise based on that same percentage.
Reality: All increase of value is on an individual basis, found by data on relevant considerations and the data of comparable properties.
This is true in robust economic times as well as poor.
Myth: You can generally tell what a house is worth simply by looking at the outside.
Reality: House value is concluded by a number of variables, including area, condition, improvements, amenities, and market trends.
As you can see, none of these things can be found just by looking at the home from the outside.
Myth: Considering that the consumer is the person who puts up the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Reality: Unless a lending agency releases its interest in the appraisal report, it is legally owned by the lending agency that purchased the appraisal.
However, home buyers have to be provided with a copy of the report upon written request, due to the Equal Credit Opportunity Act.
Myth: There's no need for home buyers to even care about what the appraisal report contains so long as their lending institution is satisfied.
Reality: Only when consumers check out a copy of their appraisal report can they verify its accuracy and know if they should ask questions. 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, as it contains an exorbitant amount 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 vicinity.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the value of a property during a sales transaction involving a lending agency.
Reality: Hiring an appraiser can fulfill a variety of necessities 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 property inspection serves the same purpose as an appraisal.
Reality: An appraisal does not serve the same purpose as an inspection report.
An appraiser finds an opinion of value in the appraisal process and resulting document.
A home inspector assesses the condition of the home and its main components and reports their findings.