Myth: The value that is ascertained by the appraiser must be equivalent to the market value.
Reality: It could be that Pennsylvania, like most states, validates the suggestion that the assessed value equals the market value; however, this is not often the case.
Examples include when interior remodeling has happened and the assessor has not seen the improvements, or when houses in the area have not been reassessed for an extended period of time.
Myth: The appraised value of a house will be different depending upon whether the appraisal is conducted for the buyer or the seller.
Reality: There is no personal interest on the part of the appraiser in the result of the appraisal report, therefore he will conduct his work with impartiality and independence, regardless of for whom the appraisal is written.
Myth: Market value will be the same as replacement cost.
Reality: The way market value is derived is based on what a buyer would likely pay a willing seller for a home without being under pressure from any external party to purchase or sell.
The replacement cost is the dollar amount needed to reconstruct a property in-kind.
Myth: There are specific ways that real estate appraisers use to show the opinion of value of a home, like the price per square foot.
Reality: There are many varied calculations that an appraiser will use to make a full investigation of every factor in consideration of the property, such as the size, location, condition, how close it is to certain facilities and the sales prices of recently sold comparable properties.
Myth: As houses increase in value by a certain percentage - in a strong economic state - the houses around the appreciating properties are expected to appreciate by the same amount.
Reality: All increase of value is on an individual basis, determined by data on relevant considerations and the data of comparable houses.
This is true in excellent economic times as well as bad.
Myth: Just examining what the home looks like on the outside gives a good idea of its value.
Reality: To conclude a concrete value beyond all doubt, an appraiser must inspect the home on a variety of factors based on location, condition, improvements, amenities, and market trends.
There's no real way to get all of this information from just inspecting the house from the exterior.
Myth: Because consumers pay for appraisals when applying for loans to purchase or refinance their home, they legally own their appraisal.
Reality: Legally, the appraisal is owned by the lending company unless the lender releases their interest in the appraisal.
Due the Equal Credit Opportunity Act, any consumer requesting a copy of the document must be given it by their lending agency.
Myth: Consumers need not worry about what is in their appraisal document so long as it exceeds the needs of their lending group.
Reality: Only when consumers examine a copy of their appraisal report can they verify its accuracy and know if they should ask questions. Remember, this is probably the most expensive and important investment a consumer will ever make.
There is a wealth of information stored in an appraisal that will probably be useful to the home buyer in the future, such as 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 assess real estate property values in home sales involving mortgage-lending deals.
Reality: Appraisers can have many different qualifications and designations which allow them to provide a lot 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 shouldn't need to get an appraisal if you have had a home inspection.
Reality: An appraisal report does not serve the same purpose as an inspection report.
The reason behind an appraisal is to find an opinion of market value during the appraisal process and the completion of the appraisal report.
House inspectors will compose a report that will explain the condition of the house and its major components and possible damage.
