Common myths about appraising

Legally, a real estate appraiser has to be state certified to produce substantiated real estate appraisals for federally-related sales. You are also entitled by law to demand a copy of the finished appraisal report from your lending agency. Contact Walz Appraisal if you have any concerns about the appraisal process.

Myth: Assessed value should be the same as to market value.

Fact: It is probable that Wisconsin, like most states, validates the idea that the assessed value is the same as the market value; however, this is not always true. Examples include when interior remodeling has happened and the assessor does not know about the improvements, or when properties 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 cost of the home will vary.

Fact: There is no personal interest on the part of the appraiser in the outcome of the appraisal, therefore he will complete his work with impartiality and independence, regardless for whom the appraisal is written.

Myth: Any time market value is established, it should equate to the replacement cost of the home.

Fact: The way market value is derived is based on what a home buyer would likely pay a willing seller for a house without being under duress from any outside party to purchase or sell. The replacement cost is the dollar amount needed to reconstruct a property in-kind.

Myth: There are specific methods that real estate appraisers use to determine the opinion of value of a property, like the price per square foot.

Fact: There are many numerous ways that an appraiser will use to make a comprehensive analysis of every factor pertaining to the property, such as the size, location, condition, how close it is to undesirable facilities and the cost of recently sold comparable homes.

Myth: As properties appreciate by a certain percentage - in a robust economy - the homes nearby are figured to appreciate by the same amount.

Fact: Value appreciation of a specific house has to be determined on a case-by-case basis, factoring in information on comparable houses and other relevant specifications within the house itself. It doesn't matter if the economy is on the rise or declining.

Myth: The house's outside is determinate of the actual price of the property; it is unnecessary to do an interior appraisal.

Fact: There are a multitude of different variables that show the value of a house; these factors include location, condition, improvements, amenities, and market trends. An external inspection definitely can't provide all of the data required.

Myth: Considering that the consumer is the one who puts up the money to pay for the appraisal when applying for a loan for any real estate transaction, legally the appraisal belongs to them.

Fact: The report is, in fact, legally owned by the lending agency - unless the lender "releases its interest" in the report. Consumers must be given a copy of the document upon written request as per the Equal Credit Opportunity Act.

Myth: Consumers need not be concerned with what is in their document so long as it satisfies the necessities of their lending agency.

Fact: A consumer should definitely read through their appraisal report; there could be some questions or some worries with the accuracy of the inspection that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. There is an incredible amount of data contained in an report that could be useful to the home buyer in the future, such as 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.