Appraisal myths & facts
By law, an appraiser needs to be state-licensed to offer appraisals for federally-backed sales. Also by law, you have the ability to request a copy of the completed report from your lending agency. Contact us if you have any concerns about the appraisal process.
Myth: The value that is assessed by the appraiser should be equivalent to the market value.
Fact: It could be that Texas, like most states, supports the common myth that the assessed value is the same as the market value; however, this certainly varies based on state-to-state. Generally when interior remodeling has occurred and the assessor is unaware of the improvement or other homes in the Pflugerville have not been reassessed for years or more, it may vary wildly.
Myth: The opinion of value of a home will be different depending upon if the appraisal is conducted for the buyer or the seller.
Fact: The appraiser has no personal interest in the outcome of the appraisal report and should complete services with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.
Myth: Market value should equate to replacement cost.
Fact: Without any influence from any different parties to buy or sell, market value is what a willing buyer would pay an interested seller for a particular property. If the property were reconstructed, the dollar amount needed to do so would make up the replacement cost.
Myth: Appraisers use a formula, like a certain price per square foot, to come to the worth of a home.
Fact: There are many numerous processes that an appraiser will use to make a full analysis of every factor in consideration of the home, such as the size, location, condition, how close it is to undesirable facilities and the cost of recently sold comparable homes.
Myth: As homes increase their worth by a certain percentage - in a strong economy - the homes in proximity are figured to appreciate by the same amount.
Fact: Any price at which an appraiser arrives concerning a certain house is always individualized, based on certain factors concluded from the information of comparable houses and other specifications within the home itself. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Travis County or Pflugerville, TX?Contact our professional staff
Myth: The property's outside is determinate of the actual worth of the house; there is no need to do an interior inspection.
Fact: There are a multitude of different factors that show the value of a house; these factors include area, condition, improvements, amenities, and market trends. There's no real way to get all of this data from just inspecting the property from the exterior.
Myth: Because consumers fund appraisal reports when applying for loans to purchase or refinance their house, they own their appraisal report.
Fact: The appraisal is, in fact, legally owned by the lending company - unless the lender "releases its interest" in the appraisal. By the Equal Credit Opportunity Act, any home buyer requesting a copy of the appraisal report must be given one by their lending agency.
Myth: There's no point for consumers to even concern themselves with what the appraisal contains so long as their lending institution is satisfied.
Fact: A home buyer should definitely read through their appraisal; there will probably be some questions or some concerns with the accuracy of the report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, containing a great deal of data - including, but certainly 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 vicinity.
Myth: There is no reason to order an appraisal unless you are trying to get an estimate of the cost of a property during a sales transaction involving a lending institution.
Fact: Depending upon their qualifications and designations, appraisers can and will provide 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 the same as a home inspection report.
Fact: Appraisal reports are definitely not the same as a home inspection report. The task of the appraiser is to form an opinion of value in the appraisal process and through writing the report. House inspectors will compose a report that will express the condition of the home and its major components and possible damage.