Appraisal myths & facts
It is mandated by legal agencies that an appraiser must be state-licensed to write appraisals for federally-related home sales in Washington. The law allows you to get a copy of your finished appraisal from your lending agency after it has been produced. Contact us if you have any concerns about the appraisal procedure.
Myth: The value that is ascertained by the appraiser will be the same as the market value.
Fact: This usually isn't true; most states do support the suggestion that the assessed value is the same as market value, but not always. Interior remodeling that the assessor is unaware of and a dearth of reassessment on nearby homes are excellent examples of why the price can vary.
Myth: The buyer or the seller will have impact in the cost of the house depending upon for whom the appraiser is working.
Fact: The appraiser has no vested interest in the result of the appraisal and should complete his job with independence, objectivity and impartiality - no matter for whom the appraisal is provided.
Myth: Market value will be the same as replacement cost.
Fact: Without any pressure from any different parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular property. The replacement cost is the dollar amount needed to reconstruct a home in-kind.
Myth: Certain methods, like the price per square foot, are the ways appraisers use to ascertain the price of a house.
Fact: There are many differing processes that an appraiser will use to make an in-depth analysis of every factor in consideration of the house, such as the size, location, condition, how close it is to specific facilities and the cost of recently sold comparable houses.
Myth: When the economy is robust and the cost of properties are reported to be increasing by a certain percentage, the other properties in the neighborhood can be expected to increase based on that same percentage.
Fact: All increase of worth is on a case-by-case basis, concluded by data on relevant elements and the data of comparable properties. It doesn't matter if the economy is on the rise or declining.
Have other questions about appraisers, appraising or real estate in Clark County or Vancouver, WA?Contact our professional staff
Myth: The house's exterior is determinate of the actual value of the home; there is no need to do an interior appraisal.
Fact: There are a multitude of different factors that conclude property value; these factors include location, condition, improvements, amenities, and market trends. As you can see, none of these things can be found just by inspecting the house from the outside.
Myth: Since the consumer is the person who provides the capital to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal is theirs.
Fact: Legally, the document is owned by the lending agency unless the lender releases their interest in the report. Due the Equal Credit Opportunity Act, any home buyer asking for a copy of the document must be given it by their lending company.
Myth: It doesn't matter to consumers what's in the report so long as it meets the requirements of their lending agency.
Fact: A consumer should definitely read through their appraisal; there may be some questions or some concerns with the accuracy of the analysis that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal report can double as a record for the future, containing an exorbitant amount 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: The only reason someone would order an appraisal is if a house needs its cost estimated in a lender sales transaction.
Fact: Based upon their qualifications and designations, appraisers can and do provide a multitude of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: An appraisal report is no different than a home inspection.
Fact: Appraisal reports are nothing like a home inspection. The purpose of an appraisal is to arrive at an opinion of fair market value during the appraisal process and the completion of the appraisal report. A home inspector assesses the condition of the home and its major components and reports their findings.