Appraisal myths & facts

It is mandated by the government that an appraiser must be state-licensed to offer appraisals for federally-related property sales in Oregon. Also by law, you have the ability to demand a copy of the finished appraisal from your lender. Contact us if you have any questions about the appraisal procedure.

Myth: The value that is assessed by the appraiser will be exactly the same as the market value.

Fact: While most states uphold the suggestion that assessed value approximates estimated market value, this generally is not the case. At times when interior remodeling has occurred and the assessor is unaware of the improvement or other houses in the Milwaukie have not been reassessed for quite some time, it may vary wildly.

Myth: Depending on whether the appraisal is written for the buyer or the seller, the cost of the home will vary.

Fact: The appraiser has no vested interest in the outcome of the report and should render services with independence, objectivity and impartiality - no matter for whom the appraisal is written.

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

Fact: The way market value is derived is based on what a buyer would be willing to pay a willing seller for a house without being under duress from any external party to buy or sell. If the home were rebuilt, the dollar amount needed to do so would make up the replacement cost.

Myth: There are specific ways that appraisers use to find the opinion of value of a property, such as the price per square foot.

Fact: There are many numerous processes that an appraiser will use to make a full analysis of every factor in consideration of the house, such as the size, location, condition, how close it is to specific facilities and the cost of recently sold comparable properties.

Myth: In a strong economy - when the worth of houses in a given neighborhood are found to be appreciating by a particular percentage - the costs of individual homes in the area can be expected to increase by that same percentage.

Fact: All increase of value is on a one-on-one basis, determined by data on relevant conditions and the data of comparable houses. It makes no difference whether the economy is good or on the decline.

Myth: You can often tell what a home is worth simply by looking at the outside.

Fact: To determine an accurate price beyond all doubt, an appraiser must assess the house on a variety of factors based on location, condition, improvements, amenities, and market trends. As you can see, none of these variables can be found simply by looking at the house from the exterior.

Myth: Since you're the one funding for the appraisal when applying for the loan to buy or refinance your home, you own the produced appraisal.

Fact: The appraisal report is, in fact, legally owned by the lender - unless the lender "releases its interest" in the report. Under the Equal Credit Opportunity Act, any consumer demanding a copy of the report must be given one by their lender.

Myth: It doesn't matter to consumers what's in the appraisal so long as it satisfies the necessities of their lending agency.

Fact: A consumer should definitely read through their appraisal; there will probably be some questions or some worries about the accuracy of the appraisal that must be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. An report can serve as a record for the future, containing an incredible amount of information - including, but certainly 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 proximity.