Myth: Assessed value will always equate market value.
Reality: While most states back the suggestion that assessed value is equal to estimated market value, this often is not the case.
Examples include when interior remodeling has occurred and the assessor has not seen the improvements, or when houses in the area have not been reassessed for an extended period of time.
Myth: The buyer or the seller sometimes may have leverage in the cost of the property depending upon for whom the appraiser is working.
Reality: The appraiser has no personal interest in the result of the appraisal and should conduct his job with independence, objectivity and impartiality - no matter for whom the appraisal is provided.
Myth: The replacement value of the home will be on par with the market value.
Reality: Without any pressure from any different parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a specific home.
Replacement value 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 methods appraisers use to determine the value of a home.
Reality: An appraisal is an amalgamation of data concluded from the home's size, location, proximity to undesirable facilities, the condition of the home and the values of recent comparable sales. You can count on Baybrooke Appraisal's appraisers to be ethical in assessing this data.
Myth: In a powerful economy - when the values of properties in a given region are found to be increasing by a certain percentage - the values of individual properties in the proximity can be expected to rise by that same percentage.
Reality: All increase of value is on an individual basis, found by information on relevant elements and the data of comparable houses.
It makes no difference whether the economy is powerful or bad.
Myth: You can generally see what a property is worth simply by looking at the exterior.
Reality: House value is determined by a number of variables, including location, condition, improvements, amenities, and market trends.
As you can see, none of these things can be found just by looking at the house from the exterior.
Myth: Because the consumer is the party who provides the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report belongs to them.
Reality: Unless a lending agency releases its vestment in the appraisal report, it is legally owned by the lending company that purchased the appraisal.
By the Equal Credit Opportunity Act, any home buyer demanding a copy of the document must be given one by their lending company.
Myth: Home buyers need not be concerned with what is in their report so long as it satisfies the necessities of their lending company.
Reality: It is a very good idea for consumers to look at a copy of their appraisal so that they can double-check the accuracy of the document, 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 appraisal report makes a valuable record for future reference, comprised of helpful and often-revealing data - 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.
Myth: Appraisals are ordered only to estimate house values in property sales involving mortgage-lending transactions.
Reality: Appraisers can have many different qualifications and designations which allow them to provide a multitude of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: There's no need to get an appraisal if you order a home inspection.
Reality: A home inspection has a completely different purpose than an appraisal report.
The point of an appraisal report is to arrive at an opinion of market value during the appraisal process and the production of the report.
The point of a home inspector is to assess the condition of the house and its major components, then produce a report on these conclusions.
