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Common myths about appraising

Legally, an appraiser needs to be state certified to produce substantiated real estate appraisals for federally-supported purchase. The law entitles you to receive a copy of your finished appraisal report from your lending agency after it has been produced. Contact DANIEL I KANDEL if you have any concerns about the appraisal process.

Myth: Assessed value will always be similar to to market value.

Fact: It is possible that Florida, like most states, supports the suggestion that the assessed value equals the market value; however, this is sometimes the exception rather than the rule. Examples include when interior reconstruction has occurred and the assessor has not seen the improvements, or when homes in the area have not been reassessed for an prolonged time.

Myth: The opinion of value of a property will be different depending upon whether the appraisal is conducted for the buyer or the seller.

Fact: The appraiser has no vested interest in the outcome of the appraisal report and should render services with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.

Myth: The replacement value of the home is always is on par with the market value.

Fact: Without any influence from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a particular property. The dollar amount demanded to reconstruct a home is what shows the replacement cost.

Myth: Appraisers use a calculation, such as a certain price per square foot, to come to the worth of a property.

Fact: Appraisers make a comprehensive analysis of all factors pertaining to the value of a house, including its location, condition, size, proximity to facilities and recent sale prices of comparable properties.

Myth: In a powerful economy - when the sales prices of homes in a given area are reported to be increasing by a particular percentage - the prices of individual houses in the area can be expected to increase by that same percentage.

Fact: All increase of worth is on a case-by-case basis, concluded by information on relevant elements and the data of comparable houses. It makes no difference whether the economy is robust or bad.

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Myth: You can usually find what a house is worth simply by looking at the outside.

Fact: To conclude an accurate worth beyond all doubt, an appraiser must examine the house on a variety of factors based on location, condition, improvements, amenities, and market trends. Obviously, none of these variables can be derived just by examining the house from the exterior.

Myth: Because the consumer is the person who provides the funding to pay for the appraisal report when applying for a loan for any real estate transaction, legally the appraisal is theirs.

Fact: Unless a lending agency releases its interest in the document, it is legally owned by the lending company that purchased the appraisal. Under the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be provided with it by their lender.

Myth: There's no reason for home buyers to even care about what the appraisal contains so long as their lending institution is fine with the contents therein.

Fact: A home buyer should definitely read through their appraisal report; there may be some questions or some concerns about the accuracy of the appraisal report that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal report makes an excellent record for future reference, filled with helpful 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 vicinity.

Myth: The only reason someone would order an appraisal is if a property needs its worth estimated in a lender sales transaction.

Fact: Hiring an appraiser can fulfill a variety of requirements 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: There's no need to get an appraisal if you order a home inspection.

Fact: Appraisal reports are nothing like a home inspection. The task of the appraiser is to arrive at an opinion of value in the appraisal process and through producing the report. A home inspector assesses the condition of the home and its major components and reports these findings.