Appraisal myths debunked
Legally, a real estate appraiser has to be state certified to produce legitimate appraisal reports for federally-supported purchase. Also by law, you have the right to demand a copy of the completed appraisal report from your lender. Contact us if you have any questions about the appraisal process.
Myth: The value that is assessed by the appraiser must be the same as the market value.
Fact: It might be that Florida, like most states, supports the suggestion that the assessed value equates to the market value; however, this is not often the case. Interior reconstruction that the assessor is unaware of and a dearth of reassessment on nearby homes are perfect examples of why there might be a differential in price.
Myth: The buyer or the seller may have leverage in the value of the home depending upon for whom the appraiser is working.
Fact: There is no personal interest on the part of the appraiser in the result of the appraisal report, therefore he will complete his work with impartiality and independence, no matter for whom the appraisal is created.
Myth: Any time market value is established, it should equate to the replacement cost of the property.
Fact: Without any suggestion from any outside parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. The replacement cost is the dollar amount required to reconstruct a house in-kind.
Myth: Appraisers use a calculation, such as a certain price per square foot, to conclude the worth of a house.
Fact: An appraisal report is an assertion of information based on the home's size, location, proximity to certain facilities, the condition of the house and the cost of recent comparable sales. You can depend on Personal Service Realty's Residential Valuation Group's appraisers to be ethical in assessing this data.
Myth: In a powerful economy - when the worth of properties in a given county are found to be increasing by a certain percentage - the worth of individual properties in the proximity can be expected to increase by that same percentage.
Fact: Any worth at which an appraiser arrives concerning a specific property is always individualized, based on certain factors found from the data of comparable houses and other considerations within the property itself. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Duval County or Jacksonville, FL?Contact us
Myth: Just examining what the property looks like on its exterior gives an excellent idea of its worth.
Fact: There are a multitude of different variables that determine property value; these factors include location, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from simply inspecting the property from the outside.
Myth: Because consumers fund the appraisal when applying for loans to purchase or refinance their home, they legally own their appraisal.
Fact: Legally, the document is owned by the lender unless the lender releases their interest in the appraisal. By the Equal Credit Opportunity Act, any consumer asking for a copy of the appraisal report must be given it by their lending company.
Myth: There's no reason for consumers to even worry about what the appraisal contains so long as their lending institution is fine with the contents therein.
Fact: Only if home buyers read a copy of their appraisal report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can serve as a record for the future, containing an exorbitant amount of data - 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 area.
Myth: The only reason someone would order an appraisal is if a house needs its value estimated in a lender-based sales transaction.
Fact: Based upon their qualifications and designations, appraisers can and will perform a series of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: There's no need to get an appraisal if you order a home inspection.
Fact: Appraisal reports have almost nothing in common with a home inspection. The appraiser concludes on an opinion of value in the appraisal process and resulting appraisal report. The point of a home inspector is to find the condition of the house and its major components, then write a report on their conclusions.
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