Common myths about appraising

Legally, a real estate appraiser needs to be state certified to write substantiated appraisal reports for federally-supported purchase. You have the ability to acquire a copy of the finished report from your lender. Contact us if you have any concerns about the appraisal process.

Myth: Assessed value generally will be similar to to market value.

Fact: It might be that California, like most states, validates the idea that the assessed value equates to the market value; however, this is sometimes the exception rather than the rule. Examples include when interior remodeling has occurred and the assessor is unaware of the improvements, or when homes in the vicinity have not been reassessed for an extended period of time.

Myth: The opinion of value of a home will be different depending upon if the appraisal is produced for the buyer or the seller.

Fact: The price of the property does not affect the pay of the appraiser; as a result, the appraiser has no personal interest in the cost of the property. This means that he will complete his business with impartiality and objectivity regardless for whom the appraisal is conducted.

Myth: Market value will be the same as replacement cost.

Fact: Market value is based on what a willing buyer would likely pay a willing seller for a particular home, with neither being under undue influence to buy or sell. If the home were rebuilt, the dollar amount necessary to do so would set the replacement cost.

Myth: There are specific ways that appraisers use to find the opinion of value of a house, such as the price per square foot.

Fact: An appraisal is a collection of information based on the house's size, location, proximity to some facilities, the condition of the property and the price of recent comparable sales. You can count on JTH Appraisals's appraisers to be honest in assessing this data.

Myth: In a powerful economy - when the sales prices of homes in a given neighborhood are reported to be rising by a certain percentage - the values of individual homes in the area can be expected to increase by that same percentage.

Fact: All increase of price is on a case-by-case basis, concluded by data on relevant conditions and the data of comparable properties. It makes no difference if the economy is good or bad.

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Myth: You can usually find what a home is worth simply by looking at the outside.

Fact: Home worth is concluded by a number of variables, including - but not limited to - area, condition, improvements, amenities, and market trends. Obviously, none of these things can be derived just by inspecting the house from the outside.

Myth: Considering that the consumer is the person who provides the money to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report is theirs.

Fact: The appraisal report is, in fact, legally owned by the lending company - unless the lender "relinquishes its interest" in the report. Consumers have to be provided with a copy of the report upon written request due to the Equal Credit Opportunity Act.

Myth: It doesn't concern consumers what's in the report so long as it satisfies the requirements of their lender.

Fact: Only if home buyers read a copy of their appraisal can they verify 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 appraisal report makes a valuable record for future reference, comprised of useful 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 area.

Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the value of a property during a sales transaction involving a lending company.

Fact: Ordering an appraisal can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.

Myth: An appraisal is no different than a home inspection.

Fact: An appraisal does not serve the same purpose as an inspection. The task of the appraiser is to conclude an opinion of value in the appraisal process and through creating the report. A home inspector assesses the condition of the home and its main components and reports these findings.