Appraisal myths & facts

Legally, a real estate appraiser has to be state certified to create substantiated real estate appraisals for federally-supported transactions. The law entitles you to acquire a copy of your completed appraisal from your lending agency after it has been provided. Contact Crowe Appraisals if you have any concerns about the appraisal process.

Myth: Market value should be equivocal to the assessed value of the property.

Fact: While most states support the suggestion that assessed value is the same as estimated market value, this generally is not the case. Interior reconstruction that the assessor is not aware of and a lack of reassessment on nearby houses are perfect examples of why this occurs.

Myth: The buyer or the seller sometimes may have impact in the cost of the property depending upon for whom the appraiser is working.

Fact: The cost of the property does not affect the pay of the appraiser; as a result, the appraiser has no preconceived interest in the cost of the home. What this means is he will complete his services with impartiality and independence regardless for whom the appraisal is produced.

Myth: The replacement value of the home is always is on par with the market value.

Fact: Without any suggestion from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. If the home were rebuilt, the dollar amount needed to do so would be the replacement cost.

Myth: There are certain methods that real estate appraisers use to find the value of a house, such as the price per square foot.

Fact: An appraisal is an assertion of data concluded from the house's size, location, proximity to undesirable facilities, the condition of the home and the value of recent comparable sales. You can rely on Crowe Appraisals's staff to be honest in assessing this data.

Myth: In a strong economy - when the sales prices of houses in a given neighborhood are reported to be rising by a particular percentage - the values of individual houses in the vicinity can be expected to increase by that same percentage.

Fact: All appreciation of value is on a case-by-case basis, determined by information on relevant conditions and the data of comparable properties. It makes no difference if the economy is good or terrible.

Myth: The house's exterior is determinate of the actual value of the house; it is unnecessary to do an interior appraisal.

Fact: To find an accurate price beyond all doubt, an appraiser must assess the property on a variety of factors based on location, condition, improvements, amenities, and market trends. An exterior inspection definitely can't provide all of the data necessary.

Myth: Since you're the one coughing up the cash for the appraisal report when applying for the loan to buy or refinance your house, you own the ordered appraisal.

Fact: Legally, the appraisal is owned by the lending agency unless the lender relinquishes their interest in the document. However, home buyers must be supplied with a copy of the report upon written request, through the Equal Credit Opportunity Act.

Myth: There's no point for home buyers to even worry about what the appraisal report contains so long as their lending agency is satisfied.

Fact: It is almost imperative for consumers to peruse a copy of their report so that they can double-check the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes an excellent record for future reference, containing useful 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.