Myth: The value that is ascertained by the appraiser is required to be exactly the same as the market value.
Reality: 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 has not investigated and a lack of reassessment on nearby houses are prime examples of why there might be a differential in price.
Myth: The opinion of value of a home will vary depending upon whether the appraisal is provided for the buyer or the seller.
Reality: The price of the property does not affect the pay of the appraiser; because of this, the appraiser has no personal interest in the value of the house. Obviously, he will conduct job with impartiality and independence regardless of for whom the appraisal is produced.
Myth: Any time market value is determined, it should equal the replacement cost of the property.
Reality: The way market value is arrived at is based on what a buyer would likely pay a willing seller for a property without being under pressure from any outside group to buy or sell.
If the home were rebuilt, the dollar amount necessary to do so would make up the replacement cost.
Myth: Appraisers use a formula, like a certain price per square foot, to figure out the value of a property.
Reality: An appraisal is an amalgamation 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 depend on DB Appraisal Services, Inc's staff to be honest in assessing this data.
Myth: As houses appreciate by a specific percentage - in a strong economy - the properties nearby are expected to increase by the same amount.
Reality: All appreciation of value is on a case-by-case basis, concluded by data on relevant elements and the data of comparable properties.
It doesn't matter if the economy is doing well or declining.
Myth: You can often tell what a home is worth simply by looking at the exterior.
Reality: To conclude a definite value beyond all doubt, an appraiser must assess the home on a variety of factors based on location, condition, improvements, amenities, and current market trends.
As you can see, none of these things can be found simply by examining the house from the outside.
Myth: Because consumers pay for appraisals when applying for loans to buy or refinance their home, they own their appraisal.
Reality: The document is, in fact, legally owned by the lending company - unless the lender "relinquishes its interest" in the appraisal.
However, home buyers must be provided with a copy of the appraisal report upon written request, under the Equal Credit Opportunity Act.
Myth: Home buyers need not worry about what is in their report so long as it satisfies the necessities of their lending group.
Reality: A consumer should definitely look through their document; there will probably be some questions or some concerns about the accuracy of the inspection that should be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make.
There is a great deal of data contained in a report that can be useful to the home buyer in the future, such as 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 house needs its value assessed in a lender sales transaction.
Reality: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You shouldn't need to get an appraisal if you have had a home inspection.
Reality: An appraisal report does not serve the same purpose as an inspection report.
The job of the appraiser is to form an opinion of value in the appraisal process and through producing the report.
The task of a home inspector is to approximate the condition of the house and its main components, then write a report on their findings.