Myth: The value that is assessed by the appraiser should be equivalent to the market value.
Reality: While most states support the concept that assessed value is the same as estimated market value, this generally is not the case.
Examples include when interior remodeling has occurred and the assessor does not know about the improvements, or when homes in the area have not been reassessed for an extended time.
Myth: Depending on whether the appraisal is drawn up for the buyer or the seller, the cost of the house will vary.
Reality: The appraiser has no personal interest in the outcome of the report and should render his job with independence, objectivity and impartiality - no matter for whom the appraisal is provided.
Myth: The replacement cost of the home will be on par with the market value.
Reality: Without any suggestion from any external parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular home.
The dollar amount demanded to reconstruct a home is what constitutes the replacement cost.
Myth: Appraisers use a calculation, such as a certain price per square foot, to conclude the value of a home.
Reality: An appraisal is an assertion of information concluded from the home's size, location, proximity to certain facilities, the condition of the property and the values of recent comparable sales. You can depend on Glasgow & Associates, LLC's staff to be ethical in assessing this data.
Myth: In a powerful economy - when the prices of houses in a given county are reported to be appreciating by a particular percentage - the values of individual properties in the vicinity can be expected to increase by that same percentage.
Reality: All appreciation of value is on a one-on-one basis, concluded by data on relevant elements and the data of comparable homes.
This is true in good economic times as well as bad.
Myth: You can generally see what a house is worth simply by looking at the outside.
Reality: There are a multitude of different variables that determine the value of a house; these factors include area, condition, improvements, amenities, and market trends.
As you can see, none of these factors can be derived just by examining the house from the exterior.
Myth: Because consumers fund appraisal reports when applying for loans to purchase or refinance their property, they legally own their appraisal.
Reality: The appraisal is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the document.
Consumers have to be given a copy of the document upon written request because of the Equal Credit Opportunity Act.
Myth: It doesn't mean anything to consumers what's in the report so long as it meets the needs of their lending company.
Reality: Only when home buyers look through a copy of their appraisal report can they ensure its accuracy and know if they should ask questions. Remember, this is probably the most expensive and important investment a consumer will ever make.
An appraisal can double as a record for the future, containing a great deal of data - 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 area.
Myth: There is no reason to order an appraisal unless you are trying to get an estimate of the value of a property during a sales transaction involving a lending institution.
Reality: Hiring an appraiser can fulfill a variety of needs depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: A house inspection serves the same purpose as an appraisal.
Reality: An appraisal does not serve the same purpose as an inspection.
An appraiser finds an opinion of value in the appraisal process and resulting appraisal report.
A home inspector analyzes the condition of the property and its main components and reports these findings.
