Common myths about appraising
Legally, an appraiser needs to be state certified to create legitimate appraisal reports for federally-related transactions. You have the ability to request a copy of the completed report from your lending agency. Contact us if you have any concerns about the appraisal process.
Myth: Assessed value will always be similar to to market value.
Fact: It is possible that Washington, like most states, validates the idea that the assessed value equals the market value; however, this is not often the case. Examples include when interior reconstruction has happened and the assessor is unaware of the improvements, or when homes in the area have not been reassessed for an extended period.
Myth: The opinion of value of a property will change depending upon whether the appraisal is conducted for the buyer or the seller.
Fact: The cost of the property does not affect the pay of the appraiser; as such, the appraiser has no pressured interest in the worth of the house. What this means is he will complete his task with impartiality and objectivity regardless for whom the appraisal is provided.
Myth: Any time market value is established, it should be the same as the replacement cost of the home.
Fact: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a specific home, with neither being under pressure to buy or sell. The dollar amount necessary to rebuild a property is what forms the replacement cost.
Myth: Appraisers use a calculation, such as a specific price per square foot, to arrive at the worth of a property.
Fact: An appraisal is a collection of data based on the house's size, location, proximity to specific facilities, the condition of the home and the cost of recent comparable sales. You can rely on Crest Appraisal Services's appraisers to be forthright in assessing this information.
Myth: In a robust economy - when the costs of properties in a given county are reported to be appreciating by a certain percentage - the worth of individual houses in the area can be expected to increase by that same percentage.
Fact: Value increase of a specific property has to be determined on a case-by-case basis, factoring in data on comparable houses and other relevant considerations. This is true in excellent economic times as well as poor.
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Myth: You can generally find what a property is worth simply by looking at the outside.
Fact: Property worth is determined by a multitude of factors, including - but not limited to - location, condition, improvements, amenities, and market trends. Obviously, none of these factors can be derived simply by viewing the house from the outside.
Myth: Considering that the consumer is the party who provides the money to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.
Fact: Unless a lending agency releases its interest in the appraisal report, it is legally owned by the lending agency that purchased the appraisal. However, consumers must be given a copy of the appraisal upon written request, under the Equal Credit Opportunity Act.
Myth: There's no point for consumers to even worry about what the appraisal contains so long as their lending company is satisfied.
Fact: A home buyer should definitely read through their appraisal report; there could be some questions or some worries with the accuracy of the report that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, containing a great deal 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 proximity.
Myth: There is no reason to order an appraisal unless you are trying to get an estimate of the value of a property during a sales transaction involving a lending company.
Fact: Appraisers can have many varied qualifications and designations which allow them to perform a lot of different services including - but not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: A home inspection serves the same purpose as an appraisal.
Fact: An appraisal does not fulfill the same purpose as an inspection report. The purpose of an appraisal report is to find an opinion of fair market value during the appraisal process and the completion of the appraisal report. The purpose of a home inspector is to approximate the condition of the property and its main components, then write a report on these findings.