Common myths about appraising

Legally, an appraiser must be state certified to perform substantiated appraisal reports for federally-backed sales. You also have the right to acquire a copy of the finished appraisal report from your lending agency. Contact Destin Appraisals if you have any concerns about the appraisal process.

Myth: Assessed value should be equal to market value.

Fact: It is probable that Florida, like most states, validates the suggestion that the assessed value equals the market value; however, this is not always true. Interior reconstruction that the assessor is not aware of and a dearth of reassessment on nearby properties are perfect examples of why this occurs.

Myth: Depending on if the appraisal is written for the buyer or the seller, the opinion of value of the house will vary.

Fact: The opinion of value of the property does not affect the payment of the appraiser; due to this, the appraiser has no pressured interest in the opinion of value of the home. What this means is he will render services with impartiality and independence regardless for whom the appraisal is created.

Myth: Any time market value is found, it should be similar to the replacement cost of the house.

Fact: The way market value is arrived at is based on what a buyer would likely pay a willing seller for a property without being under duress from any outside group to purchase or sell. If the property were rebuilt, the dollar amount necessary to do so would be the replacement cost.

Myth: Certain formulae, like the price per square foot, are what appraisers use to come to the price of a property.

Fact: There are many different ways that an appraiser will use to make an in-depth analysis of every factor pertaining to the house, such as the size, location, condition, how close it is to specific facilities and the value of recently sold comparable homes.

Myth: When the economy is strong and the worth of houses are reported to be appreciating by a certain percentage, the other homes in the vicinity can be expected to rise based on that same percentage.

Fact: Any price at which an appraiser arrives concerning a particular home is always individualized, based on certain factors concluded from the information of comparable homes and other considerations within the house itself. It makes no difference if the economy is excellent or bad.

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

Fact: There are a multitude of different factors that conclude property value; these factors include area, condition, improvements, amenities, and market trends. An outside-only inspection obviously can't provide all of the data necessary.

Myth: Because the consumer is the one who puts up the money to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal belongs to them.

Fact: The report is, in fact, legally owned by the lending company - unless the lender "releases its interest" in the appraisal. Due the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be given one by their lending company.

Myth: There's no need for consumers to even worry about what the report contains so long as their lending company is satisfied.

Fact: It is a very good idea for consumers to look at a copy of their appraisal so that they can double-check the accuracy of the report, in case it's required to question its veracity. 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 useful 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 vicinity.