Appraisal myths & facts

It is mandated by legal agencies that a real estate appraiser must be state-licensed to write appraisals for federally-related real estate transactions in California. You have the ability to request a copy of the finished appraisal from your lender. Contact our professional staff if you have any questions about the appraisal procedure.

Myth: The value that is assessed by the appraiser is required to be exactly the same as the 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. There are times when interior remodeling has occurred and the assessor is has not investigated the improvement or other homes in the Escondido have not been reassessed for years or more, it may vary wildly.

Myth: Depending on if the appraisal is done for the buyer or the seller, the cost of the house will vary.

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

Myth: The replacement cost of the house will be is on par with the market value.

Fact: Market value is acquired by what a willing buyer would likely pay a willing seller for a certain property, with neither being under pressure to buy or sell. Replacement cost is the dollar amount required to rebuild a property in-kind.

Myth: There are certain ways that real estate appraisers use to determine the opinion of value of a house, like the price per square foot.

Fact: An appraisal report is an amalgamation of data concluded from the house's size, location, proximity to undesirable facilities, the condition of the property and the worth of recent comparable sales. You can depend on The Appraisal Firm's appraisers to be forthright in assessing this data.

Myth: In a strong economy - when the prices of properties in a given neighborhood are reported to be appreciating by a certain percentage - the values of individual homes in the proximity can be expected to appreciate by that same percentage.

Fact: All appreciation of price is on an individual basis, found by information on relevant conditions and the data of comparable houses. It doesn't matter if the economy is doing well or declining.

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Myth: Just seeing what the house looks like on its exterior gives a good idea of its cost.

Fact: There are a multitude of different variables that determine the value of a house; these factors include area, condition, improvements, amenities, and market trends. There's no possible way to get all of this data from simply looking at the property from the exterior.

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 report is theirs.

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

Myth: Home buyers need not care about what is in their document so long as it meets the necessities of their lending institution.

Fact: It is almost imperative for consumers to peruse a copy of their report so that they can verify the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes an invaluable record for future reference, comprised of useful and often-revealing data - including 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: Appraisals are ordered only to assess building values in house sales involving mortgage-lending deals.

Fact: Based upon their qualifications and designations, appraisers can and may perform a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.

Myth: You don't have to get an appraisal if you get a home inspection.

Fact: Appraisal reports are definitely not the same as a home inspection. The job of the appraiser is to conclude an opinion of value in the appraisal process and through producing the report. House inspectors will compose a report that will show the condition of the house and its major components and possible damage.