Myth: The value that is ascertained by the appraiser is required to be equivalent to the market value.
Reality: This usually isn't true; most states do support the concept that the assessed value is the same as market value, but not always. Examples include when interior reconstruction has occurred and the assessor has not seen the improvements, or when properties in the area have not been reassessed for an extended time.
Myth: The appraised value of a house will change depending upon if the appraisal is provided for the buyer or the seller.
Reality: The value of the property does not affect the pay of the appraiser; due to this, the appraiser has no personal interest in the price of the house. What this means is he will complete his services with impartiality and independence regardless of for whom the appraisal is conducted.
Myth: The replacement value of the home should be on par with the market value.
Reality: Without any pressure from any external parties to buy or sell, market value is what a willing buyer would pay a willing seller for a particular home. If the home were reconstructed, the dollar amount necessary to do so would be the replacement cost.
Myth: Appraisers use a formula, such as a certain price per square foot, to come to the value of a property.
Reality: An appraisal is a collection of information based on the property's size, location, proximity to some facilities, the condition of the home and the values of recent comparable sales. You can count on BOGRIS APPRAISAL LLC's appraisers to be professional in assessing this data.
Myth: As homes increase in value by a certain percentage - in a strong economic state - the houses nearby are expected to increase by the same amount.
Reality: All increase of value is on an individual basis, determined by information on relevant conditions and the data of comparable houses. This is true in strong economic times as well as bad.
Myth: Just examining what the house looks like on its exterior gives a good idea of its value.
Reality: There are a number of different factors that determine the value of a house; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this data from simply inspecting the property from the exterior.
Myth: Since you're the one providing the money for the appraisal when applying for your loan to buy or refinance your home, you own the produced appraisal report.
Reality: The appraisal is, in fact, legally owned by the lending company - unless the lender "relinquishes its interest" in the appraisal. However, consumers have to be provided with a copy of the document upon written request, because of the Equal Credit Opportunity Act.
Myth: Home buyers need not care about what is in their appraisal document so long as it exceeds the necessities of their lending agency.
Reality: It is very important for consumers to look at a copy of their appraisal report so that they can double-check the accuracy of the report, in case it's required to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can double as a record for the future, since it contains a great deal of information - 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: 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 agency.
Reality: Based upon their qualifications and designations, appraisers can and often do perform a variety of services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A home inspection serves the same purpose as an appraisal.
Reality: A home inspection report serves a completely different purpose than an appraisal. An appraiser decides upon an opinion of value in the appraisal process and resulting report. The job of a home inspector is to approximate the condition of the home and its major components, then write a report on their findings.