Appraisal myths debunked
Legally, a real estate appraiser must be state certified to write legitimate appraisal reports for federally-supported sales. Also by law, you are entitled to receive a copy of the completed report from your lending agency. Contact us if you have any concerns about the appraisal process.
Myth: Assessed value generally will be the same as to market value.
Fact: It could be that California, like most states, validates the idea that the assessed value equals the market value; however, this is not often the case. Examples include when interior remodeling has occurred and the assessor has not seen the improvements, or when properties in the area have not been reassessed for an extended period of time.
Myth: Depending on if the appraisal is produced for the buyer or the seller, the value of the house will vary.
Fact: The value of the house does not affect the pay of the appraiser; as such, the appraiser has no pressured interest in the cost of the house. What this means is he will provide job with impartiality and independence regardless for whom the appraisal is conducted.
Myth: The replacement value of the house is always is on par with the market value.
Fact: Without any pressure from any different parties to buy or sell, market value is what a willing buyer would pay an interested seller for a particular house. Replacement value is the dollar amount required to reconstruct a property in-kind.
Myth: Specific formulae, such as the price per square foot, are what appraisers use to arrive at the price of a property.
Fact: There are many different calculations that an appraiser will use to make a comprehensive investigation of every factor in consideration of the house, such as the size, location, condition, how close it is to certain facilities and the value of recently sold comparable properties.
Myth: In a robust economy - when the sales prices of properties in a given area are found to be increasing by a certain percentage - the worth of individual properties in the area can be expected to increase by that same percentage.
Fact: All increase of value is on an individual basis, found by information on relevant conditions and the data of comparable properties. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Los Angeles County or Woodland Hills, CA?Contact our professional staff
Myth: The house's exterior is determinate of the actual worth of the property; there is no need to do an interior appraisal.
Fact: There are a number of different factors that conclude the value of a house; these factors include area, condition, improvements, amenities, and market trends. An outside-only inspection definitely can't provide all of the data required.
Myth: Because the consumer is the person 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 belongs to them.
Fact: Legally, the document is owned by the lending agency unless the lender relinquishes their interest in the document. By the Equal Credit Opportunity Act, any home buyer requesting a copy of the appraisal report must be provided with one by their lender.
Myth: Home buyers need not worry about what is in their document so long as it exceeds the necessities of their lending agency.
Fact: It is very important for consumers to go through a copy of their appraisal report so that they can double-check the accuracy of the document, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of data contained in an report that will probably be useful to the home buyer 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 proximity.
Myth: Appraisers are hired only to assess building values in home sales involving mortgage-lending transactions.
Fact: Appraisers can have many varied qualifications and designations which allow them to perform a multitude of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You shouldn't need to get an appraisal if you order a home inspection.
Fact: A home inspection has a completely different purpose than an appraisal report. The purpose of the appraiser is to form an opinion of value in the appraisal process and through creating the report. The job of a home inspector is to determine the condition of the property and its main components, then write a report on their findings.