Myth: Market value will be similar to the assessed value of the property.
Reality: While most states uphold the concept that assessed value is equal to estimated market value, this generally is not the case.
Generally when interior remodeling has occurred and the assessor is unaware of the improvement or properties in the Hammond have not been reassessed for quite some time, it may vary widely.
Myth: The buyer or the seller sometimes may have leverage in the cost of the house depending upon for whom the appraiser is working.
Reality: There is no personal interest on the part of the appraiser in the outcome of the appraisal, therefore he will conduct his work with impartiality and independence, no matter of for whom the appraisal is written.
Myth: The replacement value of the home should be on par with the market value.
Reality: Market value is arrived at through 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.
The dollar amount necessary to reconstruct a home is what constitutes the replacement cost.
Myth: Specific formulae, like the price per square foot, are the ways appraisers use to ascertain the value of a home.
Reality: Appraisers complete a full analysis of all factors in consideration to the value of a home, including its location, condition, size, proximity to facilities and recent values of comparable houses.
Myth: As properties appreciate by a certain percentage - in a robust economic state - the properties in proximity are expected to appreciate by the same amount.
Reality: Any value an appraiser reports in regards to a certain property is always personalized, based on certain factors derived from the information of comparable houses and other specifications within the house itself.
It makes no difference if the economy is good or poor.
Myth: You can usually find what a house is worth simply by looking at the exterior.
Reality: To conclude a definite value beyond all doubt, an appraiser must examine the house on a variety of factors based on location, condition, improvements, amenities, and market trends.
Obviously, none of these things can be found simply by looking at the property from the outside.
Myth: Since you're the one providing the money for the appraisal when applying for the loan to buy or refinance real estate, you own the ordered appraisal.
Reality: The appraisal report is, in fact, legally owned by the lending agency - unless the lender "releases its interest" in the report.
However, consumers have to be supplied with a copy of the appraisal report upon written request, due to the Equal Credit Opportunity Act.
Myth: Home buyers need not care about what is in their appraisal so long as it satisfies the necessities of their lending group.
Reality: A home buyer should definitely read through their report; there might be some questions or some concerns about the accuracy of the appraisal report that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make.
Also, the report makes an invaluable record for future reference, comprised of 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 proximity.
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: Appraisers can have many different qualifications and designations which allow them to provide a series 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: A home inspection serves the same purpose as an appraisal.
Reality: A home inspection report serves a completely different purpose than an appraisal report.
The task of the appraiser is to come to an opinion of value in the appraisal process and through creating the report.
A home inspector analyzes the condition of the house and its main components and reports their findings.
