Appraisal myths debunked
Legally, a real estate appraiser is required to be state certified to create legitimate real estate appraisals for federally-supported transactions. Also by law, you are entitled to receive a copy of the completed appraisal from your lending agency. Contact Northern Arizona Appraisal, Inc. if you have any questions about the appraisal procedure.
Myth: Market value has to be similar to the assessed value of the property.
Fact: It is probable that Arizona, like most states, validates the common myth that the assessed value is no different from the market value; however, this is sometimes the exception rather than the rule. Interior reconstruction that the assessor is unaware of and a dearth of reassessment on nearby homes are excellent examples of why there might be a differential in price.
Myth: The buyer or the seller may have an influence in the cost of the property depending upon for whom the appraiser is working.
Fact: The appraiser has no personal interest in the outcome of the appraisal and should render services with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.
Myth: Any time market value is found, it should be similar to the replacement cost of the home.
Fact: 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 house. If the home were rebuilt, the dollar amount required to do so would be the replacement cost.
Myth: Certain methods, like the price per square foot of the property, are the ways appraisers use to ascertain the price of a property.
Fact: There are many varied ways that an appraiser will use to make a detailed analysis of every factor pertaining to the house, such as the size, location, condition, how close it is to undesirable facilities and the opinion of value of recently sold comparable properties.
Myth: In a powerful economy - when the worth of homes in a given neighborhood are found to be appreciating by a particular percentage - the prices of individual properties in the vicinity can be expected to appreciate by that same percentage.
Fact: Any worth at which an appraiser concludes concerning a certain house is always personalized, based on certain factors concluded from the data of comparable properties and other specifications within the property itself. It doesn't matter if the economy is on the rise or declining.
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Myth: The property's outside is determinate of the actual worth of the home; there is no need to do an interior inspection.
Fact: There are a multitude of different variables that show property value; these factors include location, condition, improvements, amenities, and market trends. An outside-only inspection certainly can't provide all of the information needed.
Myth: Since you're the one paying for the appraisal report when applying for the loan to purchase or refinance real estate, you own the produced appraisal.
Fact: Legally, the appraisal report is owned by the lender unless the lender relinquishes their interest in the appraisal. However, home buyers have to be provided with a copy of the appraisal upon written request, through the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the appraisal so long as it satisfies the requirements of their lender.
Fact: Only if home buyers look over a copy of their appraisal report can they verify 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 double as a record for the future, containing an incredible amount 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: Appraisers are hired only to estimate building values in property sales involving mortgage-lending deals.
Fact: Ordering an appraisal can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can perform a multitude 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.
Fact: Appraisal reports are definitely not the same as a home inspection report. The reason behind an appraisal report is to find an opinion of fair market value during the appraisal process and the production of the report. A home inspector analyzes the condition of the property and its main components and reports these findings.