Myth: Assessed value should always equate market value.
Reality: It could be that North Carolina, like most states, validates the suggestion that the assessed value equals the market value; however, this is sometimes the exception rather than the rule.
Examples include when interior reconstruction has occurred and the assessor does not know about the improvements, or when houses in the vicinity have not been reassessed for an prolonged period of time.
Myth: Depending on whether the appraisal is provided for the buyer or the seller, the appraised value of the home will vary.
Reality: The cost of the home does not affect the salary of the appraiser; as such, the appraiser has no personal interest in the opinion of value of the house. What this means is he will conduct business with impartiality and independence regardless of for whom the appraisal is created.
Myth: Market value will be the same as replacement cost.
Reality: Market value is based on what a willing buyer would be interested in paying a willing seller for a specific home, with neither being under pressure to buy or sell.
Replacement value is the dollar amount needed to reconstruct a property in-kind.
Myth: Appraisers use a formula, like a specific price per square foot, to conclude the value of a home.
Reality: An appraisal report is an amalgamation of information based on the home's size, location, proximity to specific facilities, the condition of the home and the values of recent comparable sales. You can rely on APPRAISERSNC/CR&S Appraisal Services's staff to be honest in assessing this data.
Myth: As houses increase in value by a certain percentage - in a strong economy - the houses within the same neighborhood are expected to increase by the same amount.
Reality: An increase in value of a specific house has to be concluded on a case-by-case basis, factoring in information on comparable homes and other relevant specifications within the home itself.
It makes no difference whether the economy is excellent or terrible.
Myth: Just seeing what the house looks like on the outside gives a good idea of its value.
Reality: Home value is determined by a number of factors, including - but not limited to - area, condition, improvements, amenities, and market trends.
Obviously, none of these factors can be derived just by examining the home from the outside.
Myth: Since you're the one providing the money for the appraisal report when applying for the loan to purchase or refinance real estate, you own the ordered appraisal.
Reality: The appraisal report is, in fact, legally owned by the lending agency - unless the lender "releases its interest" in the appraisal.
However, home buyers must be given a copy of the appraisal report upon written request, through the Equal Credit Opportunity Act.
Myth: Consumers need not worry about what is in their appraisal so long as it exceeds the needs of their lending institution.
Reality: It is a very good idea for home buyers to look at a copy of their appraisal report so that they can double-check the accuracy of the report, in case they need to question its accuracy. Remember, this is probably the most expensive and important investment a consumer will ever make.
There is a great deal of information contained in an appraisal report that will probably 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.
Myth: The only reason someone would order an appraisal is if a home needs its value estimated in a lender sales transaction.
Reality: Depending upon their qualifications and designations, appraisers can and will provide a multitude of different services, including advice for estate planning, dispute resolution, zoning and tax assessment review and cost/benefit analysis.
Myth: A property inspection serves the same purpose as an appraisal.
Reality: A home inspection report serves a completely different purpose than an appraisal.
An appraiser forms an opinion of value in the appraisal process and resulting appraisal report.
House inspectors will write a report that will express the condition of the property and its major components and possible damage.
