Appraisal myths debunked

By law, an appraiser needs to be state-licensed to offer appraisals for federally-supported sales. You are also entitled by law to acquire a copy of the finished appraisal from your lender. Contact our professional staff if you have any concerns about the appraisal procedure.

Myth: Assessed value should always be equal to market value.

Fact: This is not often the case; most states do support the suggestion that the assessed value is the same as market value, but not always. Interior remodeling that the assessor has not investigated and a lack of reassessment on nearby homes are prime examples of why this occurs.

Myth: Depending on whether the appraisal is done for the buyer or the seller, the opinion of value of the home will vary.

Fact: The appraiser has no personal interest in the result of the appraisal and should complete services with independence, objectivity and impartiality - no matter for whom the appraisal is written.

Myth: Any time market value is established, it should be similar to the replacement cost of the home.

Fact: Without any pressure from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a specific home. If the property were rebuilt, the dollar amount needed to do so would form the replacement cost.

Myth: There are certain methods that real estate appraisers use to find the opinion of value of a property, such as the price per square foot.

Fact: An appraisal report is a collection of information based on the property's size, location, proximity to certain facilities, the condition of the home and the value of recent comparable sales. You can count on Savery Appraisal Services, Inc.'s appraisers to be professional in assessing this data.

Myth: As homes increase their worth by a certain percentage - in a strong economic state - the houses nearby are figured to appreciate by the same amount.

Fact: All increase of value is on a case-by-case basis, determined by data on relevant considerations and the data of comparable homes. This is true in strong economic times as well as poor.

Myth: The home's exterior is determinate of the actual value of the home; there is no need to do an interior appraisal.

Fact: There are a number of different factors that show property value; these factors include area, condition, improvements, amenities, and market trends. There's no real way to get all of this data from just examining the house from the outside.

Myth: Since you're the one providing the money for the appraisal report when applying for the loan to buy or refinance real estate, you own the ordered appraisal.

Fact: Legally, the appraisal is owned by the lending agency unless the lender releases their interest in the document. Due the Equal Credit Opportunity Act, any home buyer requesting a copy of the appraisal report must be given one by their lending agency.

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

Fact: A home buyer should definitely look through their appraisal report; there could be some questions or some concerns with the accuracy of the appraisal that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of data contained in an report that could be useful to the home buyer in the future, such as 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 proximity.