Common myths about appraising
Legally, an appraiser has to be state certified to perform substantiated real estate appraisals for federally-related purchase. Also by law, you have the ability to request a copy of the finished appraisal report from your lending agency. Contact Appraisal Express HI, LLC if you have any concerns about the appraisal process.
Myth: Market value must be equivocal to the assessed value of the property.
Fact: It is possible that Hawaii, like most states, supports the suggestion that the assessed value is the same as the market value; however, this is sometimes the exception rather than the rule. Interior reconstruction that the assessor is not aware of and a dearth of reassessment on nearby homes are excellent examples of why there might be a differential in price.
Myth: The value of a home will vary depending upon if the appraisal is provided for the buyer or the seller.
Fact: There is no personal interest on the part of the appraiser in the outcome of the analysis, therefore he will conduct his work with impartiality and independence, no matter for whom the appraisal is written.
Myth: Any time market value is found, it should equal the replacement cost of the property.
Fact: The way market value is found is based on what a buyer would be willing to pay a willing seller for a home without being under influence from any outside group to buy or sell. Replacement value is the dollar amount required to rebuild a home in-kind.
Myth: Appraisers use a formula, like a certain price per square foot, to arrive at the worth of a home.
Fact: An appraisal report is a collection of information based on the house's size, location, proximity to some facilities, the condition of the home and the value of recent comparable sales. You can depend on Appraisal Express HI, LLC's appraisers to be professional in assessing this information.
Myth: When the economy is robust and the sales prices of houses are reported to be rising by a certain percentage, the other homes in the vicinity can be expected to rise based on that same percentage.
Fact: Any cost at which an appraiser concludes in regards to a certain house is always individualized, based on certain factors found from the data of comparable houses and other considerations within the house itself. It makes no difference if the economy is excellent or poor.
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Myth: You can usually see what a home is worth simply by looking at the exterior.
Fact: There are a multitude of different variables that show property value; these factors include location, condition, improvements, amenities, and market trends. An exterior inspection obviously can't provide all of the data required.
Myth: Since you're the one funding for the appraisal when applying for your loan to purchase or refinance real estate, you own the provided appraisal report.
Fact: The appraisal is, in fact, legally owned by the lending company - unless the lender "releases its interest" in the appraisal. However, home buyers must be given a copy of the appraisal report upon written request, under the Equal Credit Opportunity Act.
Myth: It doesn't concern consumers what's in the appraisal report so long as it meets the requirements of their lending company.
Fact: It is very important for consumers to read a copy of their report so that they can double-check the accuracy of the document, in case it's required to question its accuracy. 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 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 area.
Myth: Appraisals are ordered only to assess building values in property sales involving mortgage-lending deals.
Fact: Appraisers can have many different qualifications and designations which allow them to provide a variety of different services including - but certainly not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You don't have 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 purpose of an appraisal report is to arrive at an opinion of fair market value during the appraisal process and the completion of the appraisal report. A home inspector determines the condition of the property and its main components and reports their findings.