Common myths about appraising

It is mandated by the government that an appraiser must be state-licensed to create appraisal reports for federally-related real estate purchases in New York. The law entitles you to get a copy of your completed appraisal from your lender after it has been produced. Contact our professional staff if you have any concerns about the appraisal process.

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

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 houses are excellent examples of why the price can vary.

Myth: The buyer or the seller often will have leverage in the cost of the house depending upon for whom the appraiser is working.

Fact: The appraiser has no vested interest in the result of the report and should conduct his job with independence, objectivity and impartiality - no matter for whom the appraisal is provided.

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

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

Myth: Appraisers use a formula, such as a certain price per square foot, to figure out the worth of a home.

Fact: An appraisal report is an amalgamation of data based on the house's size, location, proximity to certain facilities, the condition of the home and the value of recent comparable sales. You can count on Premier Appraisals, Inc.'s staff to be honest in assessing this information.

Myth: In a strong economy - when the costs of properties in a given neighborhood are reported to be appreciating by a particular percentage - the values of individual properties in the vicinity can be expected to increase by that same percentage.

Fact: Any cost at which an appraiser concludes concerning a particular house is always individualized, based on certain factors concluded from the data of comparable homes and other specifications within the property itself. It makes no difference whether the economy is powerful or bad.

Have other questions about appraisers, appraising or real estate in Suffolk County or Nesconset, NY?

Contact our professional staff

Myth: Just seeing what the home looks like on its exterior gives an excellent idea of its cost.

Fact: There are a multitude of different factors that conclude the value of a house; these factors include area, condition, improvements, amenities, and market trends. As you can see, none of these things can be found simply by looking at the house from the outside.

Myth: Because the consumer is the party who puts up the funding to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal report is theirs.

Fact: Legally, the appraisal is owned by the lending company unless the lender relinquishes their interest in the appraisal. Home buyers have to be given a copy of the document upon written request due to the Equal Credit Opportunity Act.

Myth: Home buyers need not care about what is in their appraisal report so long as it exceeds the necessities of their lending company.

Fact: A home buyer should definitely read through their appraisal report; there could be some questions or some worries about the accuracy of the appraisal that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal report makes a valuable record for future reference, containing 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 proximity.

Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the worth of a house during a sales transaction involving a lending agency.

Fact: Hiring an appraiser can fulfill a variety of requirements 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 report.

Fact: An appraisal report does not fulfill the same purpose as an inspection report. The appraiser decides upon an opinion of value in the appraisal process and resulting appraisal report. The point of a home inspector is to find the condition of the home and its main components, then write a report on their findings.