Myth: Assessed value should be similar to market value.
Reality: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always.
Examples include when interior remodeling has happened and the assessor has not seen the improvements, or when houses in the vicinity have not been reassessed for an prolonged period of time.
Myth: The buyer or the seller will have impact in the value of the home depending upon for whom the appraiser is working.
Reality: The appraiser has no vested interest in the result of the appraisal and should conduct his task with independence, objectivity and impartiality - no matter for whom the appraisal is provided.
Myth: The replacement cost of the home will be on par with the market value.
Reality: The way market value is derived is based on what a buyer would likely pay a willing seller for a house without being under duress from any outside group to purchase or sell.
The replacement cost is the dollar amount necessary to reconstruct a home in-kind.
Myth: Certain methods, such as the price per square foot of the property, are the ways appraisers use to determine the value of a property.
Reality: An appraisal report is an amalgamation of data based on the property's size, location, proximity to certain facilities, the condition of the house and the values of recent comparable sales. You can count on James Earp Appraisal Service's appraisers to be honest in assessing this data.
Myth: In a powerful economy - when the sales prices of properties in a given area are reported to be increasing by a particular percentage - the prices of individual houses in the vicinity can be expected to increase by that same percentage.
Reality: An increase in value of a specific house must be concluded on an individualized basis, factoring in data on comparable houses and other relevant elements.
This is true in good economic times as well as poor.
Myth: The property's exterior is determinate of the actual value of the house; there is no need to do an interior appraisal.
Reality: There are a number of different variables that determine the value of a house; these factors include area, condition, improvements, amenities, and market trends.
Obviously, none of these variables can be derived just by examining the property from the outside.
Myth: Because consumers pay for appraisal reports when applying for loans to purchase or refinance their home, they own their appraisal report.
Reality: Unless a lending agency releases its vestment in the appraisal report, it is legally owned by the lending company that ordered the appraisal.
However, home buyers have to be provided with a copy of the appraisal report upon written request, due to the Equal Credit Opportunity Act.
Myth: Home buyers need not care about what is in their appraisal document so long as it meets the needs of their lending company.
Reality: It is almost imperative for consumers to check over a copy of their appraisal report so that they can double-check the accuracy of the document, in case there is a need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make.
Also, the appraisal report makes an invaluable record for future reference, comprised of helpful and often-revealing data - including, but 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: The only reason someone would order an appraisal is if a house needs its value assessed in a lender sales transaction.
Reality: Based upon their qualifications and designations, appraisers can and do perform a variety of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A property inspection serves the same purpose as an appraisal.
Reality: Appraisal reports are nothing like a home inspection.
The purpose of the appraiser is to come to an opinion of value in the appraisal process and through producing the report.
House inspectors will write a report that will determine the condition of the house and its major components and possible damage.