Common myths about appraising
It is enforced by law that an appraiser must be state-licensed to write appraisal reports for federally-supported real estate purchases in Colorado. The law entitles you to acquire a copy of your finished report from your lending agency after it has been provided. Contact us if you have any questions about the appraisal process.
Myth: Assessed value should be similar to to market value.
Fact: This usually isn't true; most states do support the idea that the assessed value is the same as market value, but not always. Interior remodeling that the assessor is not aware of and a lack of reassessment on nearby homes are perfect examples of why this occurs.
Myth: The value of a property will change depending upon if the appraisal is ordered for the buyer or the seller.
Fact: There is no personal interest on the part of the appraiser in the outcome of the appraisal report, therefore he will conduct his work with impartiality and independence, no matter for whom the appraisal is created.
Myth: Market value will equal replacement cost.
Fact: The way market value is found is based on what a buyer would be willing to pay a willing seller for a home without being under pressure from any external group to buy or sell. Replacement value is the dollar amount required to reconstruct a home in-kind.
Myth: Appraisers use a calculation, like a certain price per square foot, to come to the cost of a house.
Fact: An appraisal report is an amalgamation of information concluded from the property's size, location, proximity to undesirable facilities, the condition of the home and the price of recent comparable sales. You can depend on Appraise Colorado Inc's staff to be ethical in assessing this information.
Myth: In a powerful economy - when the worth of properties in a given region are found to be rising by a particular percentage - the costs of individual homes in the proximity can be expected to increase 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 makes no difference whether the economy is strong or poor.
Have other questions about appraisers, appraising or real estate in Adams County or Parker, CO?Contact us
Myth: Just looking at what the home looks like on the outside gives an excellent idea of its cost.
Fact: Property value is determined by a number of variables, including location, condition, improvements, amenities, and market trends. An outside-only inspection definitely can't provide all of the information needed.
Myth: Because consumers pay for the appraisal when applying for loans to purchase or refinance real estate, they legally own their appraisal report.
Fact: Unless a lending agency releases its vestment in the report, it is legally owned by the lending agency that ordered the appraisal. However, home buyers have to be given a copy of the document upon written request, through the Equal Credit Opportunity Act.
Myth: There's no need for home buyers to even concern themselves with what the appraisal contains so long as their lending institution is fine with the contents therein.
Fact: Only if home buyers read a copy of their appraisal report can they double-check its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the report makes a valuable record for future reference, filled with 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 proximity.
Myth: The only reason someone would order an appraisal is if a home needs its price assessed in a lender-based sales transaction.
Fact: Appraisers can have many varied qualifications and designations which allow them to provide a series of different services including - but certainly not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: An appraisal is the same as a home inspection report.
Fact: An appraisal does not serve the same purpose as an inspection report. The task of the appraiser is to form 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 property and its main components, then write a report on their inspection.