Appraisal myths debunked

It is enforced by legal agencies that an appraiser is required to be state-licensed to create appraisals for federally-supported home purchases in Florida. Also by law, you have the ability to request a copy of the completed appraisal from your lender. Contact our professional staff if you have any concerns about the appraisal procedure.

Myth: Assessed value should be equal to market value.

Fact: It is possible that Florida, like most states, supports the common myth that the assessed value equals the market value; however, this is not always true. Usually when interior remodeling has occurred and the assessor is has not investigated the improvement or other homes in the area have not been reassessed for quite a while, it may vary wildly.

Myth: Depending on if the appraisal is written for the buyer or the seller, the appraised value of the home will vary.

Fact: The appraiser has no vested interest in the outcome of the appraisal report and should conduct services with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.

Myth: Market value should equate to replacement cost.

Fact: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a particular house, with neither being under undue influence to buy or sell. The replacement cost is the dollar amount required to rebuild a home in-kind.

Myth: There are certain ways that appraisers use to show the cost of a property, such as the price per square foot.

Fact: There are many differing methods that an appraiser will use to make a comprehensive 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 houses.

Myth: As homes appreciate by a specific percentage - in a strong economic state - the properties around the appreciating properties are expected to increase by the same amount.

Fact: All increase of worth is on a case-by-case basis, found by data on relevant considerations and the data of comparable properties. It makes no difference if the economy is excellent or poor.

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Myth: You can often tell what a house is worth simply by looking at the outside.

Fact: Home worth is concluded by a multitude of variables, including area, condition, improvements, amenities, and market trends. There's no possible way to get all of this information from simply looking at the home from the exterior.

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

Fact: Unless a lender releases its vestment in the appraisal report, it is legally owned by the lending agency that ordered the appraisal. However, home buyers have to be supplied with a copy of the appraisal upon written request, through the Equal Credit Opportunity Act.

Myth: It doesn't mean anything to consumers what's in the appraisal so long as it meets the needs of their lending company.

Fact: Only if consumers read a copy of their report can they double-check 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 report can double as a record for the future, as it contains an incredible amount of 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 order an appraisal unless you are trying to get an estimate of the worth of a home during a sales transaction involving a lender.

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

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

Fact: A home inspection report serves a completely different purpose than an appraisal. The point of an appraisal report is to conclude upon an opinion of fair market value during the appraisal process and the completion of the report. A home inspector analyzes the condition of the building and its main components and reports their findings.