Appraisal myths debunked
It is enforced by legal agencies that a real estate appraiser is required to be state-licensed to produce appraisal reports for federally-related real estate transactions in Oklahoma. You are also entitled by law to acquire a copy of the finished appraisal report from your lending agency. Contact us if you have any concerns about the appraisal procedure.
Myth: Market value should be similar to the assessed value of the property.
Fact: It could be that Oklahoma, like most states, validates the idea that the assessed value equals the market value; however, this is not always true. Examples include when interior reconstruction has happened and the assessor is unaware of the improvements, or when properties in the area have not been reassessed for an prolonged period.
Myth: The opinion of value of a house will vary depending upon whether the appraisal is conducted for the buyer or the seller.
Fact: There is no vested interest on the part of the appraiser in the outcome of the report, therefore he will complete his work with impartiality and independence, despite for whom the appraisal is created.
Myth: Any time market value is found, it should equate to the replacement cost of the house.
Fact: Market value is arrived at through what a willing buyer would be interested in paying a willing seller for a certain property, with neither being under duress to buy or sell. The dollar amount needed to rebuild a house is what shows the replacement cost.
Myth: Appraisers use a formula, such as a specific price per square foot, to arrive at the value of a home.
Fact: An appraisal is a collection of information concluded from the house's size, location, proximity to specific facilities, the condition of the property and the price of recent comparable sales. You can depend on OK Appraisals's appraisers to be professional in assessing this data.
Myth: When the economy is on the rise and the sales prices of properties are reported to be increasing by a certain percentage, the other houses in the vicinity can be expected to appreciate based on that same percentage.
Fact: Any price at which an appraiser arrives in regards to a particular home is always individualized, based on certain factors pulled from the information of comparable properties and other specifications within the house itself. It doesn't matter if the economy is doing well or declining.
Have other questions about appraisers, appraising or real estate in Oklahoma County or Oklahoma City, OK?Contact our professional staff
Myth: You can generally find what a house is worth simply by looking at the exterior.
Fact: There are a number of different variables that show property value; these factors include location, condition, improvements, amenities, and market trends. An outside-only inspection certainly can't provide all of the data required.
Myth: Because consumers fund the appraisal when applying for loans to purchase or refinance their home, they own their appraisal report.
Fact: Legally, the document is owned by the lending agency unless the lender releases their interest in the appraisal. Home buyers must be provided with a version of the appraisal report through request due to the Equal Credit Opportunity Act.
Myth: Home buyers need not worry about what is in their report so long as it satisfies the requirements of their lending company.
Fact: Only if consumers check out a copy of their appraisal report can they verify 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 appraisal report makes a near perfect record for future reference, comprised of helpful and often-revealing information - 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 area.
Myth: Appraisals are ordered only to assess real estate property values in property sales involving mortgage-lending transactions.
Fact: Ordering an appraisal can fulfill a variety of needs depending on the designations and certifications of the appraiser involved; appraisers can perform a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: An appraisal is the same as a home inspection.
Fact: An appraisal does not fulfill the same purpose as an inspection report. An appraiser forms an opinion of value in the appraisal process and resulting document. House inspectors will write a report that will express the condition of the property and its major components and possible damage.