Myth: Assessed value will always be equal to market value.
Reality: It is probable that Louisiana, like most states, validates the suggestion that the assessed value is the same as the market value; however, this is not always true.
Usually when interior remodeling has occurred and the assessor is not aware of the improvement or other homes in the neighborhood have not been reassessed for quite some time, it may vary widely.
Myth: The buyer or the seller can have leverage in the value of the home depending upon for whom the appraiser is working.
Reality: The value of the property does not affect the pay of the appraiser; because of this, the appraiser has no pressured interest in the opinion of value of the house. What this means is he will conduct job with impartiality and independence regardless of for whom the appraisal is produced.
Myth: The replacement value of the house should be on par with the market value.
Reality: Without any pressure from any outside parties to purchase or sell, market value is what a willing buyer would pay an interested seller for a particular property.
Replacement value is the dollar amount necessary to rebuild a property in-kind.
Myth: There are specific ways that real estate appraisers use to find the opinion of value of a property, such as the price per square foot.
Reality: Appraisers complete an exhaustive analysis of all factors in consideration to the value of a house, including its location, condition, size, proximity to facilities and recent values of comparable properties.
Myth: In a robust economy - when the prices of homes in a given area are found to be appreciating by a particular percentage - the prices of individual houses in the vicinity can be expected to rise by that same percentage.
Reality: The appreciation of a certain home has to be determined on a case-by-case basis, factoring in information on comparable properties and other relevant elements.
It doesn't matter if the economy is doing well or declining.
Myth: The home's exterior is determinate of the expected price of the house; it is unnecessary to do an interior appraisal.
Reality: House value is determined by a number of variables, including area, condition, improvements, amenities, and market trends.
There's no possible way to get all of this data from just inspecting the property from the exterior.
Myth: Because the consumer is the person who provides the capital to pay for the appraisal report when applying for a loan for any real estate transaction, by law the appraisal is theirs.
Reality: The appraisal report is, in fact, legally owned by the lending agency - unless the lender "relinquishes its interest" in the report.
Because of the Equal Credit Opportunity Act, any home buyer requesting a copy of the document must be provided with it by their lending agency.
Myth: Home buyers need not care about what is in their appraisal report so long as it meets the requirements of their lending agency.
Reality: It is very important for home buyers to look at a copy of their appraisal so that they can verify the accuracy of the document, in case it's required to question its veracity. Remember, this is probably the most expensive and important investment a consumer will ever make.
There is an incredible amount of information contained in an appraisal report that should 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 region.
Myth: There is no reason to hire an appraiser unless you are trying to get an assessment of the value of a property during a sales transaction involving a lending company.
Reality: Appraisers can have many different qualifications and designations which allow them to provide a lot of different services including - but not limited to - advice on estate planning, tax assessment, zoning, dispute resolution in many different legal situations and cost analysis.
Myth: An appraisal is the same as a home inspection.
Reality: A home inspection report has a completely different purpose than an appraisal report.
The point of an appraisal report is to find an opinion of market value during the appraisal process and the completion of the report.
House inspectors will compose a report that will determine the condition of the property and its major components and possible damage.
