Common myths about appraising
Legally, an appraiser needs to be state certified to perform substantiated real estate appraisals for federally-supported transactions. Also by law, you are allowed to receive a copy of the finished appraisal from your lender. Contact us if you have any concerns about the appraisal procedure.
Myth: Assessed value should always equate to market value.
Fact: It might be that Nebraska, like most states, validates the common myth 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 does not know about the improvements, or when houses in the vicinity have not been reassessed for an extended period.
Myth: Depending on whether the appraisal is done for the buyer or the seller, the cost of the house will vary.
Fact: The price of the house does not affect the pay of the appraiser; due to this, the appraiser has no preconceived interest in the worth of the home. What this means is he will provide services with impartiality and objectivity regardless for whom the appraisal is produced.
Myth: Market value should approximate replacement cost.
Fact: Market value is derived from what a willing buyer would be interested in paying a willing seller for a particular property, with neither being under pressure to buy or sell. The dollar amount required to reconstruct a property is what forms the replacement cost.
Myth: Certain formulae, such as the price per square foot, are what appraisers use to arrive at the price of a house.
Fact: Appraisers make a full analysis of all factors pertaining to the cost of a house, including its location, condition, size, proximity to facilities and recent opinion of value of comparable homes.
Myth: As properties appreciate by a certain percentage - in a strong economic state - the properties within the same neighborhood are figured to increase by the same amount.
Fact: All increase of price is on a one-on-one basis, found by data on relevant conditions and the data of comparable homes. This is true in strong economic times as well as bad.
Have other questions about appraisers, appraising or real estate in Douglas County or Omaha, NE?Contact our professional staff
Myth: The property's exterior is determinate of the actual value of the house; there is no need to do an interior appraisal.
Fact: Home value is determined by a multitude of factors, including - but not limited to - area, condition, improvements, amenities, and market trends. As you can see, none of these factors can be found just by viewing the home from the exterior.
Myth: Since you're the one paying for the appraisal report when applying for your loan to purchase or refinance real estate, you own the provided appraisal.
Fact: The report is, in fact, legally owned by the lender - unless the lender "releases its interest" in the appraisal. However, consumers must be provided with a copy of the report upon written request, due to the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the report so long as it satisfies the requirements of their lender.
Fact: A home buyer should definitely read through their appraisal report; there could be some questions or some worries about the accuracy of the analysis that need to 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, comprised of helpful and often-revealing data - 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 area.
Myth: There is no reason to hire an appraiser unless you are trying to get an estimate of the price of a home during a sales transaction involving a lending institution.
Fact: Hiring an appraiser can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can provide a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is the same as a home inspection.
Fact: Appraisal reports are definitely not the same as a home inspection. The function of an appraisal is to find an opinion of fair market value during the appraisal process and the completion of the report. House inspectors will compose a report that will show the condition of the property and its major components and possible damage.