Appraisal myths & facts

By law, an appraiser is required to be state-licensed to produce appraisals for federally-supported sales. The law gives you the right to receive a copy of your finished appraisal report from your lender after it has been produced. Contact TSH Real Estate and Appraisal Services, LLC if you have any concerns about the appraisal process.

Myth: Market value needs to be similar to the assessed value of the property.

Fact: This is not often the case; most states do support the suggestion that the assessed value is the same as market value, but not always. Examples include when interior remodeling has happened and the assessor has not seen the improvements, or when homes in the area have not been reassessed for an extended period of time.

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

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

Myth: The replacement value of the house will be is on par with the market value.

Fact: Without any influence from any external parties to purchase or sell, market value is what a willing buyer would pay a willing seller for a specific home. The dollar amount needed to reconstruct a home is what forms the replacement cost.

Myth: There are certain methods that real estate appraisers use to determine the cost of a home, like the price per square foot.

Fact: An appraisal is a collection of information concluded from the home's size, location, proximity to undesirable facilities, the condition of the house and the price of recent comparable sales. You can depend on TSH Real Estate and Appraisal Services, LLC's staff to be professional in assessing this information.

Myth: As houses increase their worth by a specific percentage - in a strong economic state - the houses within the same neighborhood are figured to appreciate by the same amount.

Fact: Price appreciation of a certain home must be concluded on an individualized basis, factoring in information on comparable properties and other relevant considerations. This is true in excellent economic times as well as poor.

Have other questions about appraisers, appraising or real estate in Honolulu County or Kaneohe, HI?

Contact our professional staff

Myth: Just looking at what the home looks like on the outside gives an excellent idea of its value.

Fact: There are a number of different factors that determine property value; these factors include location, condition, improvements, amenities, and market trends. There's no real way to get all of this data from simply examining the house from the exterior.

Myth: Considering that the consumer is the person who puts up the capital to pay for the appraisal when applying for a loan for any real estate transaction, by law the appraisal belongs to them.

Fact: Unless a lender releases its vestment in the document, it is legally owned by the lending agency that ordered the appraisal. However, consumers must be provided with a copy of the document upon written request, because of the Equal Credit Opportunity Act.

Myth: Consumers need not care about what is in their document so long as it satisfies the necessities of their lending company.

Fact: It is a very good idea for home buyers to check over a copy of their appraisal so that they can verify the accuracy of the report, in case they need to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal makes a near perfect record for future reference, comprised of useful and often-revealing 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: The only reason someone would hire an appraiser is if a home needs its worth assessed in a lender-based sales transaction.

Fact: Hiring an appraiser can fulfill a variety of wants depending on the designations and certifications of the appraiser involved; appraisers can provide a variety of different services, including benefit/cost analysis, tax assessment, legal dispute resolution, and even estate planning.

Myth: There's no reason to get an appraisal if you have had a home inspection.

Fact: Appraisal reports are nothing like a home inspection. The appraiser forms an opinion of value in the appraisal process and resulting appraisal report. House inspectors will create a report that will explain the condition of the home and its major components and possible damage.