Myth: Assessed value should always be similar to market value.
Reality: This is not often the case; most states do support the concept that the assessed value is the same as market value, but not always.
Examples include when interior remodeling has occurred and the assessor is unaware of the improvements, or when homes in the vicinity have not been reassessed for an extended time.
Myth: The appraised value of a property will differ depending upon whether the appraisal is conducted for the buyer or the seller.
Reality: The price of the house does not affect the payment of the appraiser; due to this, the appraiser has no preconceived interest in the opinion of value of the house. Obviously, he will conduct business with impartiality and independence regardless of for whom the appraisal is conducted.
Myth: Any time market value is determined, it should match the replacement cost of the property.
Reality: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a specific house, with neither being under pressure to buy or sell.
Replacement value is the dollar amount necessary to reconstruct a home in-kind.
Myth: Appraisers use a calculation, such as a certain price per square foot, to arrive at the value of a property.
Reality: An appraisal report is an assertion of data concluded from the home's size, location, proximity to certain facilities, the condition of the house and the values of recent comparable sales. You can depend on Crescent Appraisal Group, Inc.'s appraisers to be professional in assessing this information.
Myth: As homes appreciate by a specific percentage - in a robust economy - the properties in proximity are expected to appreciate by the same amount.
Reality: The appreciation of a certain home is always determined on an individualized basis, factoring in information on comparable homes and other relevant considerations.
It makes no difference if the economy is strong or bad.
Myth: Just seeing what the home looks like on the outside gives a good idea of its value.
Reality: To determine a concrete 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 derived simply by inspecting the house from the outside.
Myth: Because the consumer is the person who puts up the capital to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal report belongs to them.
Reality: The document is, in fact, legally owned by the lending company - unless the lender "releases its interest" in the appraisal.
Consumers have to be supplied with a version of the document upon written request due to the Equal Credit Opportunity Act.
Myth: There's no reason for consumers to even worry about what the appraisal contains so long as their lending agency is satisfied.
Reality: A consumer should definitely inspect their appraisal; there could be some questions or some worries with the accuracy of the inspection that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make.
Also, the appraisal makes a near perfect record for future reference, filled with useful and often-revealing 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 proximity.
Myth: The only reason someone would hire an appraiser is if a property needs its value assessed in a lender sales transaction.
Reality: Appraisers can have many different qualifications and designations which allow them to provide a multitude of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: A property inspection serves the same purpose as an appraisal.
Reality: An appraisal does not serve the same purpose as an inspection report.
The purpose of the appraiser is to find an opinion of value in the appraisal process and through writing the report.
The task of a home inspector is to determine the condition of the house and its main components, then write a report on their findings.