Appraisal myths & facts

By law, an appraiser is required to be state-licensed to produce appraisals for federally-supported transactions. You also have the right to acquire a copy of the completed appraisal report from your lending agency. Contact us if you have any concerns about the appraisal procedure.

Myth: The value that is ascertained by the appraiser is required to be the same as the market value.

Fact: It might be that Florida, like most states, validates the suggestion that the assessed value equates to the market value; however, this certainly varies based on state-to-state. Interior reconstruction that the assessor has not investigated and a lack of reassessment on nearby homes are prime examples of why the price can vary.

Myth: The opinion of value of a house will differ depending upon if the appraisal is produced for the buyer or the seller.

Fact: The price of the house does not affect the salary of the appraiser; because of this, the appraiser has no personal interest in the worth of the home. What this means is he will provide task with impartiality and objectivity regardless for whom the appraisal is produced.

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

Fact: Without any suggestion from any different parties to buy or sell, market value is what a willing buyer would pay an interested seller for a particular house. The replacement cost is the dollar amount required to reconstruct a home in-kind.

Myth: Certain formulae, such as the price per square foot of the property, are what appraisers use to arrive at the price of a property.

Fact: Appraisers complete a full analysis of all factors in consideration to the price of a home, including its location, condition, size, proximity to facilities and recent costs of comparable houses.

Myth: In a robust economy - when the worth of properties in a given neighborhood are found to be rising by a certain percentage - the prices of individual homes in the area can be expected to rise by that same percentage.

Fact: Worth increase of a certain home is always concluded on an individualized basis, factoring in information on comparable houses and other relevant elements. It doesn't matter if the economy is on the rise or declining.

Myth: You can often tell what a home is worth simply by looking at the exterior.

Fact: To conclude an accurate value beyond all doubt, an appraiser must assess the property on a variety of factors based on area, condition, improvements, amenities, and current market trends. There's no possible way to get all of this information from just inspecting the property from the outside.

Myth: Because consumers pay for appraisal reports when applying for loans to purchase or refinance their home, they legally own their appraisal report.

Fact: Unless a lender releases its interest in the document, it is legally owned by the lending agency that ordered the appraisal. Because of the Equal Credit Opportunity Act, any consumer demanding 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 report so long as it meets the requirements of their lending agency.

Fact: Only if consumers read a copy of their appraisal report can they ensure its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can double as a record for the future, as it contains an exorbitant amount of information - 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.