Common myths about appraising

By law, an appraiser must be state-licensed to offer appraisals for federally-related purchases. Also by law, you have the ability to receive a copy of the finished appraisal from your lender. Contact M Davies Appraisal LLC if you have any concerns about the appraisal procedure.

Myth: Market value should be similar to the assessed value of the property.

Fact: While most states back the suggestion that assessed value is equal to estimated market value, this generally is not the case. Often when interior remodeling has occurred and the assessor is has not investigated the improvement or properties in the neighborhood have not been reassessed for quite a while, it may vary wildly.

Myth: The buyer or the seller sometimes may have leverage in the cost of the property depending upon for whom the appraiser is working.

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

Myth: Market value will equal 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 specific property. If the house were rebuilt, the dollar amount needed to do so would form the replacement cost.

Myth: Appraisers use a formula, like a specific price per square foot, to conclude the worth of a house.

Fact: An appraisal is a collection of information concluded from the home's size, location, proximity to undesirable facilities, the condition of the house and the worth of recent comparable sales. You can depend on M Davies Appraisal LLC's staff to be professional in assessing this information.

Myth: In a robust economy - when the costs of properties in a given county are found to be appreciating by a particular percentage - the costs of individual properties in the vicinity can be expected to appreciate by that same percentage.

Fact: All increase of price is on a case-by-case basis, found by information on relevant conditions and the data of comparable homes. This is true in excellent economic times as well as bad.

Myth: The house's outside is determinate of the actual price of the home; it is unnecessary to do an interior appraisal.

Fact: There are a multitude of different factors that conclude the value of a house; these factors include area, condition, improvements, amenities, and market trends. As you can see, none of these things can be derived simply by looking at the home from the exterior.

Myth: Since the consumer is the one who puts up the funding to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal is theirs.

Fact: Unless a lending agency releases its interest in the appraisal report, it is legally owned by the lending agency that ordered the appraisal. By the Equal Credit Opportunity Act, any home buyer asking for a copy of the report must be given one by their lending company.

Myth: Home buyers need not worry about what is in their appraisal so long as it meets the necessities of their lending group.

Fact: A consumer should definitely inspect their appraisal report; there will probably be some questions or some concerns about 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. There is a wealth of data contained in an report that could be useful to the consumer 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 vicinity.