Myth: Assessed value should be equal to market value.
Reality: It is possible that Ohio, like most states, supports the suggestion that the assessed value is no different from the market value; however, this is not always true.
Examples include when interior reconstruction has happened and the assessor has not seen the improvements, or when properties in the vicinity have not been reassessed for an extended period of time.
Myth: The buyer or the seller can have impact in the value of the home depending upon for whom the appraiser is working.
Reality: The appraiser has no personal interest in the result of the appraisal report and should complete services with independence, objectivity and impartiality - no matter for whom the appraisal is conducted.
Myth: Market value should equate to replacement cost.
Reality: Market value is based on what a willing buyer would likely pay a willing seller for a certain property, with neither being under pressure to buy or sell.
If the home were reconstructed, the dollar amount necessary to do so would be the replacement cost.
Myth: Specific methods, such as the price per square foot, are the methods appraisers use to determine the value of a home.
Reality: Appraisers complete a full analysis of all factors in consideration to the value of a property, including its location, condition, size, proximity to facilities and recent sale prices of comparable homes.
Myth: As houses appreciate by a certain percentage - in a strong economic state - the houses around the appreciating properties are expected to increase by the same amount.
Reality: Any value an appraiser reports in regards to a certain house is always individualized, based on certain factors found from the information of comparable homes and other specifications within the property itself.
This is true in robust economic times as well as poor.
Myth: You can often find what a property is worth simply by looking at the outside.
Reality: There are a multitude of different factors that conclude the value of a home; these factors include area, condition, improvements, amenities, and market trends.
An external inspection obviously can't provide all of the data necessary.
Myth: Because the consumer is the party who provides the capital to pay for the appraisal report when applying for a loan for any real estate transaction, legally the appraisal is theirs.
Reality: Legally, the report is owned by the lending company unless the lender relinquishes their interest in the document.
Consumers must be provided with a version of the document upon written request due to the Equal Credit Opportunity Act.
Myth: There's no need for home buyers to even worry about what the appraisal report contains so long as their lending institution is satisfied.
Reality: A consumer should definitely look through their appraisal report; there could 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.
There is a wealth of information contained in an appraisal report that can be useful to the consumer 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 area.
Myth: Appraisals are ordered only to estimate home values in house sales involving mortgage-lending transactions.
Reality: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can provide a multitude of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.
Myth: You shouldn't need to get an appraisal if you get a home inspection.
Reality: Appraisal reports are nothing like a home inspection report.
The point of an appraisal is to arrive at an opinion of market value during the appraisal process and the production of the appraisal report.
House inspectors will produce a report that will explain the condition of the house and its major components and possible damage.