Appraisal myths debunked
By law, an appraiser is enforced to be state-licensed to offer appraisals for federally-backed sales. The law gives you the right to acquire a copy of your finished appraisal report from your lender after it has been produced. Contact our professional staff if you have any questions about the appraisal process.
Myth: Assessed value should always be similar to to market value.
Fact: It is possible that California, like most states, supports the suggestion that the assessed value is the same as the market value; however, this is not often the case. Examples include when interior reconstruction has happened and the assessor does not know about the improvements, or when properties in the area have not been reassessed for an prolonged period.
Myth: The buyer or the seller sometimes may have an influence in the value of the home depending upon for whom the appraiser is working.
Fact: The appraiser has no vested interest in the result of the appraisal report and should complete his task with independence, objectivity and impartiality - no matter for whom the appraisal is written.
Myth: The replacement value of the property should be is on par with the market value.
Fact: Market value is derived from what a willing buyer would likely pay a willing seller for a certain property, with neither being under undue influence to buy or sell. If the home were reconstructed, the dollar amount needed to do so would form the replacement cost.
Myth: There are specific methods that appraisers use to determine the value of a property, such as the price per square foot.
Fact: An appraisal is a collection of data based on the house's size, location, proximity to some facilities, the condition of the property and the value of recent comparable sales. You can count on WalshStreet Appraisals's staff to be professional in assessing this information.
Myth: When the economy is strong and the sales prices of houses are found to be rising by a certain percentage, the other properties in the neighborhood can be expected to appreciate based on that same percentage.
Fact: Any worth at which an appraiser arrives in regards to a certain house is always personalized, based on certain factors concluded from the information of comparable houses and other specifications within the property itself. This is true in fair economic times as well as bad.
Have other questions about appraisers, appraising or real estate in Los Angeles County or Los Angeles, CA?Contact our professional staff
Myth: You can often tell what a property is worth simply by looking at the exterior.
Fact: There are a number of different variables that determine the value of a house; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from just inspecting the house from the exterior.
Myth: Since the consumer is the one who puts up the money to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Fact: Unless a lending agency releases its vestment in the appraisal report, it is legally owned by the lending company that ordered the appraisal. However, consumers must be supplied with a copy of the appraisal report upon written request, because of the Equal Credit Opportunity Act.
Myth: There's no reason for consumers to even worry about what the report contains so long as their lending agency is fine with the contents therein.
Fact: A home buyer should definitely look through their report; there will probably be some questions or some worries about the accuracy of the analysis that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a great deal of information contained in an appraisal that should be useful to the consumer in the future, such as 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: The only reason someone would order an appraisal is if a home needs its cost estimated in a lender sales transaction.
Fact: Based upon their qualifications and designations, appraisers can and often do provide a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: You don't have to get an appraisal if you have had a home inspection.
Fact: An appraisal does not serve the same purpose as an inspection report. The task of the appraiser is to arrive at an opinion of value in the appraisal process and through writing the report. House inspectors will create a report that will determine the condition of the property and its major components and possible damage.