Myth: Assessed value should be the same as market value.
Reality: It might be that Texas, like most states, validates the idea that the assessed value is no different from the market value; however, this is sometimes the exception rather than the rule.
At times when interior remodeling has been done and the assessor is unaware of the improvement or other homes in the neighborhood have not been reassessed for quite a while, it may vary widely.
Myth: The buyer or the seller will have impact in the value of the house depending upon for whom the appraiser is working.
Reality: There is no personal interest on the part of the appraiser in the result of the report, therefore he will complete his work with impartiality and independence, despite of for whom the appraisal is written.
Myth: Any time market value is determined, it should equal the replacement cost of the home.
Reality: Market value is arrived at through what a willing buyer would likely pay a willing seller for a certain property, with neither being under pressure to buy or sell.
The dollar amount required to reconstruct a home is what forms the replacement cost.
Myth: Appraisers use a calculation, such as a certain price per square foot, to come to the value of a house.
Reality: There are many numerous ways that an appraiser will use to make an in-depth investigation of every factor in consideration of the property, such as the size, location, condition, how close it is to certain facilities and the sales prices of recently sold comparable properties.
Myth: When the economy is strong and the sales prices of properties are reported to be appreciating by a certain percentage, the other homes in the proximity can be expected to increase based on that same percentage.
Reality: Any value an appraiser reports concerning a particular home is always personalized, based on certain factors derived from the information of comparable properties and other considerations within the property itself.
It makes no difference if the economy is powerful or poor.
Myth: You can generally find what a home is worth simply by looking at the outside.
Reality: There are a multitude of different factors that show property value; these factors include area, condition, improvements, amenities, and market trends.
Obviously, none of these variables can be derived simply by inspecting the house from the exterior.
Myth: Because consumers pay for the appraisal when applying for loans to buy or refinance their house, they legally own their appraisal report.
Reality: Unless a lender releases its interest in the document, it is legally owned by the lending company that ordered the appraisal.
Consumers have to be provided with a copy of the appraisal report upon written request because of the Equal Credit Opportunity Act.
Myth: It doesn't matter to consumers what's in the report so long as it satisfies the needs of their lending agency.
Reality: It is almost imperative for consumers to read a copy of their report so that they can verify the accuracy of the document, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make.
An appraisal report can serve as a record for the future, containing an exorbitant amount of data - including, but 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.
Myth: Appraisals are ordered only to assess building values in home sales involving mortgage-lending transactions.
Reality: Appraisers can have many varied qualifications and designations which allow them to perform a series of different services including - but definitely not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: You don't have to get an appraisal if you order a home inspection.
Reality: Appraisal reports are nothing like a home inspection.
The function of an appraisal is to form an opinion of market value during the appraisal process and the production of the appraisal report.
House inspectors will produce a report that will determine the condition of the home and its major components and possible damage.
