Common myths about appraising

It is required by the government that an appraiser is required to be state-licensed to perform appraisal reports for federally-supported real estate purchases in Tennessee. Also by law, you are allowed to demand a copy of the completed report from your lending agency. Contact us if you have any concerns about the appraisal process.

Myth: Market value should be equivocal to the assessed value of the property.

Fact: While most states support the suggestion that assessed value equates estimated market value, this usually is not the case. At times when interior remodeling has occurred and the assessor is unaware of the improvement or other homes in the neighborhood have not been reassessed for years or more, it may vary wildly.

Myth: The value of a home will differ depending upon if the appraisal is conducted for the buyer or the seller.

Fact: The opinion of value of the property does not affect the salary of the appraiser; because of this, the appraiser has no personal interest in the worth of the home. This means that he will render task with impartiality and objectivity regardless for whom the appraisal is provided.

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

Fact: The way market value is arrived at is based on what a home buyer would likely pay a willing seller for a house without being under influence from any outside group to buy or sell. Replacement value is the dollar amount necessary to rebuild a property in-kind.

Myth: There are certain methods that appraisers use to determine the value of a home, like the price per square foot.

Fact: An appraisal is an assertion of data based on the house's size, location, proximity to specific facilities, the condition of the house and the cost of recent comparable sales. You can count on Integrated Assets's staff to be forthright in assessing this information.

Myth: When the economy is on the rise and the value of properties are found to be rising by a certain percentage, the other homes in the vicinity can be expected to appreciate based on that same percentage.

Fact: All increase of price is on a case-by-case basis, determined by data on relevant considerations and the data of comparable houses. It makes no difference whether the economy is good or bad.

Myth: The home's outside is determinate of the actual value of the home; it is unnecessary to do an interior inspection.

Fact: Property worth is determined by a multitude of factors, including - but not limited to - location, condition, improvements, amenities, and market trends. There's no real way to get all of this data from just looking at the house from the outside.

Myth: Since you're the one providing the money for the appraisal when applying for your loan to purchase or refinance your house, you own the provided appraisal report.

Fact: Legally, the document is owned by the lending company unless the lender relinquishes their interest in the report. Due the Equal Credit Opportunity Act, any home buyer demanding a copy of the appraisal report must be provided with one by their lending company.

Myth: It doesn't mean anything to consumers what's in the appraisal so long as it meets the requirements of their lender.

Fact: A consumer should definitely look through their report; there could be some questions or some worries with the accuracy of the analysis that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An appraisal can serve as a record for the future, since 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 area.