Appraisal myths & facts
By law, an appraiser needs to be state-licensed to produce appraisals for federally-related purchases. The law entitles you to receive a copy of your completed appraisal report from your lending agency after it has been provided. Contact our professional staff if you have any concerns about the appraisal process.
Myth: Market value has to be equivocal to the assessed value of the property.
Fact: It is probable that Maryland, like most states, supports the idea that the assessed value is no different from the market value; however, this is not often the case. Often when interior remodeling has occurred and the assessor is not aware of the improvement or other houses in the area have not been reassessed for quite a while, it may vary wildly.
Myth: The value of a house will vary depending upon if the appraisal is produced for the buyer or the seller.
Fact: The value of the house does not affect the pay of the appraiser; as such, the appraiser has no pressured interest in the cost of the property. What this means is he will render business with impartiality and independence regardless for whom the appraisal is provided.
Myth: Market value will equate to replacement cost.
Fact: The way market value is derived is based on what a home buyer would be willing to pay a willing seller for a house without being under influence from any external group to buy or sell. Replacement cost is the dollar amount needed to rebuild a home in-kind.
Myth: There are specific ways that appraisers use to determine the opinion of value of a property, such as the price per square foot.
Fact: An appraisal is a collection of data concluded from the house's size, location, proximity to some facilities, the condition of the home and the worth of recent comparable sales. You can depend on Astute Appraisals, Inc.'s staff to be professional in assessing this data.
Myth: When the economy is strong and the value of homes are reported to be appreciating by a certain percentage, the other homes in the area can be expected to rise based on that same percentage.
Fact: Cost increase of a certain home is always concluded on a case-by-case basis, factoring in information on comparable homes and other relevant specifications within the property itself. It makes no difference if the economy is excellent or on the decline.
Have other questions about appraisers, appraising or real estate in Howard County or Columbia, MD?Contact Astute Appraisals, Inc.
Myth: Just examining what the property looks like on the outside gives an excellent idea of its worth.
Fact: There are a multitude of different variables that show the value of a home; these factors include area, condition, improvements, amenities, and market trends. An external inspection definitely can't provide all of the data necessary.
Myth: Because consumers pay for the appraisal when applying for loans to buy or refinance their home, they own their appraisal report.
Fact: Legally, the appraisal report is owned by the lending company unless the lender releases their interest in the document. Because of the Equal Credit Opportunity Act, any consumer requesting a copy of the report must be provided with it by their lending company.
Myth: Home buyers need not worry about what is in their report so long as it meets the necessities of their lending institution.
Fact: Only if home buyers look over a copy of their report can they ensure its accuracy and possibly need to question the result. 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, containing 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 vicinity.
Myth: The only reason someone would hire an appraiser is if a property needs its value assessed in a lender sales transaction.
Fact: Appraisers can have many different qualifications and designations which allow them to perform a multitude of different services including - but not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: A property inspection serves the same purpose as an appraisal.
Fact: A home inspection has a completely different purpose than an appraisal. 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 express the condition of the house and its major components and possible damage.