Appraisal myths debunked
It is mandated by legal agencies that an appraiser needs to be state-licensed to produce appraisal reports for federally-supported real estate sales in Nebraska. The law gives you the right to receive a copy of your finished appraisal from your lender after it has been produced. Contact our professional staff if you have any concerns about the appraisal process.
Myth: Market value will be similar to the assessed value of the property.
Fact: While most states support the idea that assessed value is the same as estimated market value, this generally is not the case. Generally when interior remodeling has occurred and the assessor is has not investigated the improvement or other houses in the Omaha have not been reassessed for years or more, it may vary wildly.
Myth: The buyer or the seller will have an influence in the value of the home depending upon for whom the appraiser is working.
Fact: The price of the home does not affect the payment of the appraiser; due to this, the appraiser has no vested interest in the value of the property. This means that he will conduct task with impartiality and independence regardless for whom the appraisal is produced.
Myth: The replacement value of the house will be is on par with the market value.
Fact: The way market value is derived is based on what a home buyer would be willing to pay a willing seller for a home without being under duress from any external party to buy or sell. The replacement cost is the dollar amount needed to rebuild a house in-kind.
Myth: Certain methods, like the price per square foot of the property, are the ways appraisers use to determine the worth of a property.
Fact: Appraisers make a detailed analysis of all factors in consideration to the cost of a home, including its location, condition, size, proximity to facilities and recent costs of comparable properties.
Myth: In a powerful economy - when the worth of homes in a given region are reported to be rising by a particular percentage - the costs of individual houses in the proximity can be expected to appreciate by that same percentage.
Fact: All increase of value is on an individual basis, concluded by information on relevant elements and the data of comparable houses. It doesn't matter if the economy is on the rise or declining.
Have other questions about appraisers, appraising or real estate in Douglas County or Omaha, NE?Contact our professional staff
Myth: The property's outside is determinate of the actual value of the home; it is unnecessary to do an interior appraisal.
Fact: There are a number of different variables that show the value of a house; these factors include area, condition, improvements, amenities, and market trends. There's no possible way to get all of this information from just inspecting the house from the exterior.
Myth: Since the consumer is the one who provides the capital to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal report belongs to them.
Fact: The document is, in fact, legally owned by the lending company - unless the lender "releases its interest" in the report. However, consumers must be given a copy of the report upon written request, under the Equal Credit Opportunity Act.
Myth: It doesn't mean anything to consumers what's in the appraisal so long as it satisfies the necessities of their lending company.
Fact: A home buyer should definitely read through their appraisal; there might be some questions or some worries about the accuracy of the report that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes a near perfect record for future reference, containing useful and often-revealing data - 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 vicinity.
Myth: Appraisals are ordered only to estimate real estate property values in house sales involving mortgage-lending deals.
Fact: Hiring an appraiser can fulfill a variety of requirements 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: A property inspection serves the same purpose as an appraisal.
Fact: An appraisal does not fulfill the same purpose as an inspection. The job of the appraiser is to come to an opinion of value in the appraisal process and through producing the report. The job of a home inspector is to approximate the condition of the house and its main components, then compose a report on these conclusions.