Appraisal myths & facts
By law, an appraiser is required to be state-licensed to produce appraisals for federally-related purchases. The law allows you to receive a copy of your finished appraisal from your lender after it has been provided. Contact us if you have any concerns about the appraisal process.
Myth: Assessed value generally will be equal to market value.
Fact: While most states back the idea that assessed value equates estimated market value, this often is not the case. Interior reconstruction that the assessor is unaware of and a dearth of reassessment on nearby homes are exact examples of why this occurs.
Myth: The opinion of value of a property will vary depending upon if the appraisal is conducted for the buyer or the seller.
Fact: The appraiser has no vested interest in the outcome of the appraisal and should complete services with independence, objectivity and impartiality - no matter for whom the appraisal is written.
Myth: The replacement value of the house is always is on par with the market value.
Fact: The way market value is found is based on what a buyer would be willing to pay a willing seller for a property without being under influence from any outside group to purchase or sell. If the house were reconstructed, the dollar amount needed to do so would make up the replacement cost.
Myth: There are specific methods that real estate appraisers use to determine the value of a property, such as the price per square foot.
Fact: There are many numerous formulae that an appraiser will use to make a detailed analysis of every factor pertaining to the house, such as the size, location, condition, how close it is to certain facilities and the sales price of recently sold comparable houses.
Myth: When the economy is on the rise and the sales prices of homes are reported to be appreciating by a certain percentage, the other homes in the neighborhood can be expected to rise based on that same percentage.
Fact: Any worth at which an appraiser concludes in regards to a certain property is always individualized, based on certain factors concluded from the data of comparable homes and other considerations within the property itself. It makes no difference whether the economy is good or terrible.
Have other questions about appraisers, appraising or real estate in Queens County or Jamaica Estates, NY?Contact Sirius Appraisal Services
Myth: Just seeing what the property looks like on the outside gives a good idea of its value.
Fact: There are a number of different factors that determine the value of a house; these factors include location, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from simply examining the home from the outside.
Myth: Since the consumer is the one who puts up the capital to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report belongs to them.
Fact: Unless a lending agency releases its interest in the report, it is legally owned by the lending agency that purchased the appraisal. However, consumers must be given a copy of the document upon written request, due to the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the report so long as it satisfies the requirements of their lending agency.
Fact: Only if home buyers check out a copy of their appraisal can they double-check its accuracy and possibly need to question the result. 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 helpful and often-revealing information - 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 proximity.
Myth: There is no reason to order an appraisal unless you are trying to get an assessment of the price of a house during a sales transaction involving a lending institution.
Fact: Based upon their qualifications and designations, appraisers can and will perform a variety of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: You shouldn't need to get an appraisal if you have had a home inspection.
Fact: A home inspection has a completely different purpose than an appraisal report. The function of an appraisal report is to form an opinion of fair market value during the appraisal process and the production of the appraisal. House inspectors will write a report that will show the condition of the house and its major components and possible damage.