Common myths about appraising

It is mandated by legal agencies that a real estate appraiser is required to be state-licensed to offer appraisals for federally-supported property purchases in Washington. The law allows you to acquire a copy of your completed appraisal from your lending agency after it has been provided. Contact us if you have any questions about the appraisal process.

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

Fact: It is probable that Washington, like most states, validates the idea that the assessed value is the same as the market value; however, this is not always true. Sometimes when interior remodeling has been done and the assessor is unaware of the improvement or other houses in the area have not been reassessed for years or more, it may vary wildly.

Myth: The appraised value of a property will vary depending upon if the appraisal is produced for the buyer or the seller.

Fact: The price of the house does not affect the payment of the appraiser; as such, the appraiser has no pressured interest in the value of the house. What this means is he will provide job with impartiality and independence regardless for whom the appraisal is produced.

Myth: Any time market value is established, it should equate to the replacement cost of the house.

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

Myth: Certain methods, like the price per square foot of the property, are what appraisers use to arrive at the price of a property.

Fact: Appraisers make a comprehensive analysis of all factors in consideration to the worth of a property, including its location, condition, size, proximity to facilities and recent costs of comparable houses.

Myth: As properties increase their worth by a certain percentage - in a robust economic state - the houses in proximity are expected to appreciate by the same amount.

Fact: Worth appreciation of a specific house has to be determined on an individualized basis, factoring in information on comparable homes and other relevant specifications within the house itself. It makes no difference whether the economy is robust or terrible.

Myth: The house's outside is determinate of the actual value of the property; it is unnecessary to do an interior inspection.

Fact: There are a number of different factors that conclude the value of a home; these factors include location, condition, improvements, amenities, and market trends. An outside-only inspection certainly can't provide all of the data needed.

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

Fact: Legally, the appraisal report is owned by the lending agency unless the lender releases their interest in the document. However, home buyers must be supplied with a copy of the report upon written request, due to the Equal Credit Opportunity Act.

Myth: There's no point for home buyers to even worry about what the appraisal report contains so long as their lending institution is fine with the contents therein.

Fact: It is almost imperative for consumers to look at a copy of their report so that they can double-check the accuracy of the report, in case it's required 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, filled with useful and often-revealing information - 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.