Legally, an appraiser must be state certified to write substantiated real estate appraisals for federally-related transactions. The law gives you the right to acquire a copy of your finished report from your lending agency after it has been produced. Contact our professional staff if you have any concerns about the appraisal procedure.
New York Appraisers discusses myths and realities about real estate appraisals and appraisers
Myth: The value that is assessed by the appraiser should be equivalent to the market value.
Reality: While most states back the idea that assessed value is equal to estimated market value, this often is not the case. Examples include when interior reconstruction has occurred and the assessor is unaware of the improvements, or when houses in the area have not been reassessed for an extended period of time.
Myth: Depending on whether the appraisal is produced for the buyer or the seller, the value of the property will vary.
Reality: There is no real interest on the part of the appraiser in the result of the report, therefore he will conduct his work with impartiality and independence, regardless of for whom the appraisal is ordered.
Myth: Market value should mirror replacement cost.
Reality: The way market value is found is based on what a home buyer would likely pay a willing seller for a property without being under pressure from any external party to buy or sell. The dollar amount necessary to rebuild a home is what shows the replacement cost.
Myth: Appraisers use a calculation, such as a specific price per square foot, to figure out the value of a property.
Reality: Appraisers make a full analysis of all factors pertaining to the value of a property, including its location, condition, size, proximity to facilities and recent values of comparable properties.
Myth: As houses appreciate by a certain percentage – in a robust economy – the homes nearby are figured to increase by the same amount.
Reality: An increase in value of a certain home must be concluded on a case-by-case basis, factoring in information on comparable houses and other relevant considerations. It doesn’t matter if the economy is on the rise or declining.
Myth: You can often see what a home is worth simply by looking at the exterior.
Reality: There are a multitude of different factors that determine the value of a home; these factors include area, condition, improvements, amenities, and market trends. There’s no possible way to get all of this information from just examining the home from the exterior.
Myth: Because consumers pay for the appraisal when applying for loans to buy or refinance their home, they own their appraisal report.
Reality: The report is, in fact, legally owned by the lending company – unless the lender “relinquishes its interest” in the appraisal report. Consumers have to be given a version of the appraisal report upon written request as per the Equal Credit Opportunity Act.
Myth: Consumers need not worry about what is in their report so long as it satisfies the requirements of their lending company.
Reality: It is almost imperative for home buyers to peruse a copy of their appraisal report so that they can double-check the accuracy of the report, in case there is a need to question its accuracy. 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 certainly 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: The only reason someone would hire an appraiser is if a home needs its value estimated in a lender sales transaction.
Reality: Ordering an appraisal can fulfill a variety of requirements depending on the designations and certifications of the appraiser involved; appraisers can perform a great deal of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You don’t have to get an appraisal if you order a home inspection.
Reality: A home inspection serves a completely different purpose than an appraisal report. The purpose of the appraiser is to find an opinion of value in the appraisal process and through creating the report. The point of a home inspector is to assess the condition of the property and its major components, then create a report on their findings.
Contact our professional staff if you have any other questions about appraisers, appraising or real estate in Saratoga or Saratoga Springs, New York.