Myth: Assessed value generally will be equal to market value.
Reality: While most states support the suggestion that assessed value is the same as estimated market value, this often is not the case.
Interior remodeling that the assessor has not investigated and a lack of reassessment on nearby properties are perfect examples of why the price can vary.
Myth: Depending on if the appraisal is produced for the buyer or the seller, the cost of the house will vary.
Reality: There is no vested interest on the part of the appraiser in the result of the report, therefore he will complete his work with impartiality and independence, no matter of for whom the appraisal is created.
Myth: The replacement value of the house should be on par with the market value.
Reality: The way market value is found is based on what a buyer would likely pay a willing seller for a home without being under duress from any external group to buy or sell.
If the house were reconstructed, the dollar amount necessary to do so would set the replacement cost.
Myth: Specific formulae, such as the price per square foot, are the methods appraisers use to determine the value of a house.
Reality: An appraisal report is an assertion of information based on the house's size, location, proximity to undesirable facilities, the condition of the property and the values of recent comparable sales. You can count on Dennis W. Elder's appraisers to be honest in assessing this data.
Myth: When the economy is strong and the sales prices of properties are reported to be rising by a certain percentage, the other houses in the area can be expected to increase based on that same percentage.
Reality: All appreciation of value is on an individual basis, determined by data on relevant conditions and the data of comparable houses.
It doesn't matter if the economy is doing well or declining.
Myth: The house's exterior is determinate of the actual value of the home; there is no need to do an interior inspection.
Reality: Property value is concluded by a multitude of factors, including - but not limited to - location, condition, improvements, amenities, and market trends.
There's no real way to get all of this information from simply viewing the property from the outside.
Myth: Because the consumer is the party who puts up the capital to pay for the appraisal report when applying for a loan for any real estate transaction, legally the appraisal is theirs.
Reality: Unless a lending agency releases its interest in the document, it is legally owned by the lending company that ordered the appraisal.
Due the Equal Credit Opportunity Act, any home buyer asking for a copy of the report must be given one by their lender.
Myth: There's no need for consumers to even concern themselves with what the appraisal contains so long as their lending institution is satisfied.
Reality: Only when home buyers look over a copy of their report can they double-check its accuracy and know if they should ask questions. 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, filled with useful and often-revealing information - 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: There is no reason to order an appraisal unless you are trying to get an assessment of the value of a home during a sales transaction involving a lending agency.
Reality: Ordering an appraisal can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can provide a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You don't have to get an appraisal if you have had a home inspection.
Reality: Appraisal reports are definitely not the same as a home inspection.
The purpose of an appraisal report is to arrive at an opinion of market value during the appraisal process and the completion of the appraisal.
House inspectors will compose a report that will express the condition of the property and its major components and possible damage.