Appraisal myths & facts

It is enforced by legal agencies that a real estate appraiser needs to be state-licensed to perform appraisal reports for federally-supported real estate transactions in Florida. You have the ability to request a copy of the completed appraisal from your lender. Contact our professional staff if you have any concerns about the appraisal process.

Myth: The value that is ascertained by the appraiser should be equivalent to the market value.

Fact: While most states back the concept that assessed value equates estimated market value, this often is not the case. Examples include when interior remodeling has happened and the assessor does not know about the improvements, or when homes in the vicinity have not been reassessed for an extended period of time.

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 vested interest on the part of the appraiser in the result of the appraisal report, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is conducted.

Myth: Any time market value is established, it should equal the replacement cost of the property.

Fact: The way market value is arrived at is based on what a home buyer would be willing to pay a willing seller for a house without being under influence from any outside group to purchase or sell. The dollar amount required to reconstruct a home is what shows the replacement cost.

Myth: There are specific methods that appraisers use to find the cost of a house, such as the price per square foot.

Fact: An appraisal is an amalgamation of information based on the property's size, location, proximity to undesirable facilities, the condition of the property and the value of recent comparable sales. You can rely on Norman Appraisal Services's appraisers to be ethical in assessing this information.

Myth: When the economy is strong and the cost of houses are reported to be increasing by a certain percentage, the other properties in the proximity can be expected to rise based on that same percentage.

Fact: Any price at which an appraiser arrives concerning a particular property is always individualized, based on certain factors concluded from the data of comparable homes and other considerations within the house itself. It makes no difference if the economy is excellent or on the decline.

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

Fact: Home value is concluded by a number of variables, including location, condition, improvements, amenities, and market trends. There's no real way to get all of this information from just examining the house from the outside.

Myth: Since you're the one coughing up the cash for the appraisal report when applying for the loan to purchase or refinance real estate, you own the provided appraisal.

Fact: Unless a lender releases its vestment in the appraisal report, it is legally owned by the lending company that ordered the appraisal. Under the Equal Credit Opportunity Act, any home buyer asking for a copy of the appraisal report must be given one by their lending company.

Myth: It doesn't matter to consumers what's in the appraisal so long as it meets the needs of their lending agency.

Fact: It is very important for consumers to peruse a copy of their appraisal so that they can double-check the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of data stored in an report that will probably be useful to the consumer 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 area.