Myth: Market value must be the same as the assessed value of the property.
Reality: While most states back the suggestion that assessed value is the same as estimated market value, this commonly is not the case.
Sometimes when interior remodeling has occurred and the assessor is not aware of the improvement or properties in the neighborhood have not been reassessed for a good length of time, it may vary widely.
Myth: Depending on whether the appraisal is done for the buyer or the seller, the value of the home will vary.
Reality: There is no personal interest on the part of the appraiser in the outcome of the report, therefore he will complete his work with impartiality and independence, despite of for whom the appraisal is conducted.
Myth: Any time market value is established, it should be the same as the replacement cost of the house.
Reality: Market value is derived from what a willing buyer would be interested in paying a willing seller for a specific house, with neither being under undue influence to buy or sell.
Replacement cost is the dollar amount needed to reconstruct a house in-kind.
Myth: There are certain methods that appraisers use to find the opinion of value of a house, like the price per square foot.
Reality: An appraisal report is an amalgamation of information concluded from the property's size, location, proximity to some facilities, the condition of the house and the values of recent comparable sales. You can rely on Trust Real Estate Appraisal Services PLC's staff to be ethical in assessing this data.
Myth: As houses increase in value by a certain percentage - in a robust economic state - the properties in proximity are figured to increase by the same amount.
Reality: All appreciation of value is on an individual basis, concluded by information on relevant elements and the data of comparable properties.
It doesn't matter if the economy is on the rise or declining.
Myth: The home's exterior is determinate of the actual value of the house; there is no need to do an interior appraisal.
Reality: Home value is concluded by a multitude of variables, including location, condition, improvements, amenities, and market trends.
There's no possible way to get all of this data from just inspecting the house from the exterior.
Myth: Because consumers fund appraisal reports when applying for loans to buy or refinance their home, they legally own their appraisal report.
Reality: The appraisal is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the appraisal.
Due the Equal Credit Opportunity Act, any home buyer demanding a copy of the appraisal report must be given it by their lending company.
Myth: It doesn't concern consumers what's in the appraisal so long as it meets the needs of their lending agency.
Reality: A consumer should definitely look through their appraisal; there could be some questions or some concerns 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.
Also, the report makes a valuable record for future reference, containing useful 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 vicinity.
Myth: Appraisals are ordered only to assess house values in property sales involving mortgage-lending deals.
Reality: Based upon their qualifications and designations, appraisers can and may perform a lot of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: An appraisal is no different than a home inspection report.
Reality: A home inspection report serves a completely different purpose than an appraisal report.
The reason behind an appraisal is to conclude upon an opinion of market value during the appraisal process and the production of the report.
The point of a home inspector is to assess the condition of the property and its main components, then produce a report on their inspection.