Appraisal myths debunked
It is enforced by legal agencies that an appraiser is required to be state-licensed to produce appraisals for federally-supported real estate transactions in Washington. The law entitles you to receive a copy of your finished appraisal from your lending agency after it has been produced. Contact Crest Appraisal Services if you have any questions about the appraisal process.
Myth: Market value will be the same as 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. There are times when interior remodeling has occurred and the assessor is has not investigated the improvement or other houses in the Seattle have not been reassessed for quite some time, it may vary wildly.
Myth: The appraised value of a home will vary depending upon whether the appraisal is provided for the buyer or the seller.
Fact: The appraiser has no personal interest in the outcome of the appraisal report and should render his task with independence, objectivity and impartiality - no matter for whom the appraisal is written.
Myth: Market value will equate to replacement cost.
Fact: Without any pressure from any external parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular property. If the home were rebuilt, the dollar amount required to do so would form the replacement cost.
Myth: Specific formulae, like the price per square foot, are the ways appraisers use to ascertain the value of a home.
Fact: Appraisers make a detailed analysis of all factors in consideration to the value of a house, including its location, condition, size, proximity to facilities and recent opinion of value of comparable homes.
Myth: When the economy is robust and the cost of homes are reported to be rising by a certain percentage, the other houses in the proximity can be expected to appreciate based on that same percentage.
Fact: Any value at which an appraiser arrives concerning a particular property is always personalized, based on certain factors concluded from the information of comparable houses and other considerations within the house itself. It makes no difference if the economy is strong or on the decline.
Have other questions about appraisers, appraising or real estate in King County or Seattle, WA?Contact our professional staff
Myth: You can usually find what a home is worth simply by looking at the outside.
Fact: House value is concluded by a multitude of factors, including - but not limited to - location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from just looking at the home from the exterior.
Myth: Because the consumer is the one who puts up the money to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report is theirs.
Fact: Unless a lender releases its vestment in the document, it is legally owned by the lending agency that ordered the appraisal. By the Equal Credit Opportunity Act, any home buyer requesting a copy of the appraisal report must be given it by their lending company.
Myth: Home buyers need not care about what is in their appraisal so long as it satisfies the requirements of their lending company.
Fact: It is very important for home buyers to check over 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. An appraisal can serve as a record for the future, since it contains an exorbitant amount of information - 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 area.
Myth: Appraisers are hired only to estimate real estate property values in property sales involving mortgage-lending transactions.
Fact: Ordering an appraisal can fulfill a variety of needs depending on the designations and certifications of the appraiser involved; appraisers can perform a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is the same as a home inspection.
Fact: A home inspection has a completely different purpose than an appraisal report. An appraiser decides upon an opinion of value in the appraisal process and resulting document. The task of a home inspector is to approximate the condition of the house and its main components, then provide a report on these inspection.