Myth: Assessed value will always be the same as market value.
Reality: It could be that North Carolina, like most states, validates the common myth that the assessed value is no different from the market value; however, this is not always true.
Examples include when interior remodeling has happened and the assessor is unaware of the improvements, or when homes in the area have not been reassessed for an prolonged period.
Myth: The appraised value of a property will vary depending upon if the appraisal is produced for the buyer or the seller.
Reality: There is no real interest on the part of the appraiser in the result of the appraisal report, therefore he will conduct his work with impartiality and independence, no matter of for whom the appraisal is written.
Myth: Any time market value is calculated, it should be the same as 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 home, with neither being under undue influence to buy or sell.
The dollar amount needed to reconstruct a house is what forms the replacement cost.
Myth: There are certain ways that appraisers use to find the value of a property, such as the price per square foot.
Reality: Appraisers make a full analysis of all factors in consideration to the value of a house, including its location, condition, size, proximity to facilities and recent sale prices of comparable houses.
Myth: As properties increase in value by a certain percentage - in a strong economic state - the houses within the same neighborhood are figured to appreciate by the same amount.
Reality: Any value an appraiser derives in regards to a particular property is always individualized, based on certain factors found from the information of comparable homes and other specifications within the house itself.
This is true in good economic times as well as poor.
Myth: Just examining what the house looks like on the outside gives an idea of its value.
Reality: To determine a solid value beyond all doubt, an appraiser must examine the home on a variety of factors based on location, condition, improvements, amenities, and current market trends.
An external inspection certainly can't provide all of the data necessary.
Myth: Because consumers fund the appraisal when applying for loans to buy or refinance their property, they legally own their appraisal report.
Reality: Legally, the document is owned by the lender 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: It doesn't mean anything to consumers what's in the appraisal report so long as it meets the necessities of their lending agency.
Reality: A consumer should definitely read through their appraisal; there may be some questions or some concerns about the accuracy of the report that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make.
An appraisal report can double as a record for the future, as it contains a great deal of information - 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 vicinity.
Myth: There is no reason to order an appraisal unless you are trying to get an assessment of the value of a property during a sales transaction involving a lending company.
Reality: Ordering an appraisal can fulfill a variety of necessities depending on the designations and certifications of the appraiser involved; appraisers can perform a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: A property inspection serves the same purpose as an appraisal.
Reality: A home inspection has a completely different purpose than an appraisal report.
An appraiser finds an opinion of value in the appraisal process and resulting appraisal report.
The point of a home inspector is to determine the condition of the house and its major components, then produce a report on these findings.