Appraisal myths & facts

By law, an appraiser is enforced to be state-licensed to produce appraisals for federally-backed transactions. You are also entitled by law to acquire a copy of the finished appraisal from your lender. Contact Performance Appraisals Inc. if you have any concerns about the appraisal procedure.

Myth: The value that is ascertained by the appraiser will be equivalent to the market value.

Fact: It is probable that Florida, like most states, validates the suggestion that the assessed value is the same as the market value; however, this is not often the case. There are times when interior remodeling has been done and the assessor is unaware of the improvement or other homes in the Ponte Vedra Beach 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 ordered for the buyer or the seller.

Fact: There is no real interest on the part of the appraiser in the outcome of the report, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is written.

Myth: Any time market value is established, it should be the same as the replacement cost of the house.

Fact: The way market value is derived is based on what a home buyer would be willing to pay a willing seller for a home without being under pressure from any outside group to purchase or sell. The replacement cost is the dollar amount needed to rebuild a house in-kind.

Myth: Appraisers use a calculation, such as a certain price per square foot, to come to the worth of a property.

Fact: Appraisers complete an exhaustive analysis of all factors pertaining to the value of a property, including its location, condition, size, proximity to facilities and recent costs of comparable properties.

Myth: In a powerful economy - when the values of homes in a given neighborhood are reported to be increasing by a particular percentage - the prices of individual houses in the proximity can be expected to appreciate by that same percentage.

Fact: Worth appreciation of a certain property is always determined on a case-by-case basis, factoring in information on comparable properties and other relevant elements. It doesn't matter if the economy is doing well or declining.

Myth: You can commonly find what a home is worth simply by looking at the outside.

Fact: To conclude an accurate worth beyond all doubt, an appraiser must inspect the home on a variety of factors based on area, condition, improvements, amenities, and current market trends. As you can see, none of these factors can be found just by looking at the home from the exterior.

Myth: Because the consumer is the party who puts up the funding to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report is theirs.

Fact: The document is, in fact, legally owned by the lending company - unless the lender "relinquishes its interest" in the appraisal report. Home buyers have to be given a copy of the appraisal report upon written request because of the Equal Credit Opportunity Act.

Myth: It doesn't matter to consumers what's in the report so long as it satisfies the necessities of their lender.

Fact: Only if consumers read a copy of their appraisal can they double-check its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes a near perfect record for future reference, filled with helpful and often-revealing 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 vicinity.