Appraisal myths & facts

By law, an appraiser is required to be state-licensed to perform appraisals for federally-supported transactions. The law allows you to get a copy of your finished appraisal report from your lending agency after it has been provided. Contact us if you have any concerns about the appraisal process.

Myth: Assessed value generally will be the same as to market value.

Fact: This usually isn't true; most states do support the suggestion that the assessed value is the same as market value, but not always. Sometimes when interior remodeling has been done and the assessor is has not investigated the improvement or properties in the East Longmeadow have not been reassessed for quite some time, it may vary wildly.

Myth: The buyer or the seller can have impact in the cost of the property depending upon for whom the appraiser is working.

Fact: The appraiser has no vested interest in the outcome of the appraisal and should render his job with independence, objectivity and impartiality - no matter for whom the appraisal is written.

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

Fact: Market value is derived from what a willing buyer would be interested in paying a willing seller for a specific home, with neither being under duress to buy or sell. The dollar amount required to reconstruct a property is what forms the replacement cost.

Myth: There are specific ways that appraisers use to show the value of a home, like the price per square foot.

Fact: Appraisers make a full analysis of all factors in consideration to the price of a house, including its location, condition, size, proximity to facilities and recent values of comparable homes.

Myth: When the economy is doing well and the value of houses are reported to be appreciating by a certain percentage, the other houses in the neighborhood can be expected to rise based on that same percentage.

Fact: All appreciation of price is on a one-on-one basis, concluded by information on relevant elements and the data of comparable homes. It makes no difference if the economy is good or terrible.

Myth: Just seeing what the home looks like on its exterior gives a good idea of its value.

Fact: To determine an accurate value beyond all doubt, an appraiser must assess the home on a variety of factors based on area, condition, improvements, amenities, and current market trends. There's no possible way to get all of this information from just examining the property from the exterior.

Myth: Because consumers fund appraisals when applying for loans to purchase or refinance their home, they legally own their appraisal.

Fact: Legally, the report is owned by the lending agency unless the lender relinquishes their interest in the report. However, consumers have to be provided with a copy of the report upon written request, under the Equal Credit Opportunity Act.

Myth: There's no point for home buyers to even worry about what the appraisal contains so long as their lender is fine with the contents therein.

Fact: Only if consumers check out a copy of their report can they double-check its accuracy and possibly need to question the result. Remember, this is probably the most expensive and important investment a consumer will ever make. There is a wealth of data stored in an appraisal 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 region.