Common myths about appraising

It is required by the government that an appraiser is required to be state-licensed to write appraisal reports for federally-supported home transactions in Texas. Also by law, you have the ability to request a copy of the finished appraisal report from your lending agency. Contact our professional staff if you have any concerns about the appraisal process.

Myth: Assessed value will always be similar to to market value.

Fact: It could be that Texas, like most states, supports the suggestion that the assessed value is no different from the market value; however, this certainly varies based on state-to-state. Examples include when interior remodeling has occurred and the assessor does not know about the improvements, or when properties in the vicinity have not been reassessed for an extended period of time.

Myth: Depending on if the appraisal is ordered for the buyer or the seller, the opinion of value of the house will vary.

Fact: The appraiser has no personal interest in the outcome of the appraisal and should render his task with independence, objectivity and impartiality - no matter for whom the appraisal is provided.

Myth: Any time market value is found, it should equal the replacement cost of the house.

Fact: Without any suggestion from any external parties to buy or sell, market value is what a willing buyer would pay an interested seller for a particular house. Replacement cost is the dollar amount required to rebuild a home in-kind.

Myth: There are certain methods that real estate appraisers use to find the value of a house, such as the price per square foot.

Fact: An appraisal is an assertion of information based on the home's size, location, proximity to specific facilities, the condition of the home and the worth of recent comparable sales. You can depend on Sunago Advisory Group, Inc.'s appraisers to be honest in assessing this information.

Myth: In a powerful economy - when the values of houses in a given area are found to be increasing by a certain percentage - the costs of individual properties in the vicinity can be expected to increase by that same percentage.

Fact: Any worth at which an appraiser concludes in regards to a specific property is always personalized, based on certain factors derived from the information of comparable properties and other considerations within the home itself. It doesn't matter if the economy is doing well or declining.

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

Fact: To conclude an accurate price beyond all doubt, an appraiser must examine the home on a variety of factors based on area, condition, improvements, amenities, and market trends. Obviously, none of these factors can be found just by inspecting the house from the exterior.

Myth: Since you're the one providing the money for the appraisal when applying for your loan to buy or refinance real estate, you own the produced appraisal report.

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

Myth: Consumers need not care about what is in their appraisal so long as it exceeds the needs of their lending agency.

Fact: A home buyer should definitely look through their appraisal report; there could be some questions or some worries about the accuracy of the appraisal that need to be addressed. Remember, this is probably the most expensive and important investment a consumer will ever make. Also, the appraisal report makes a valuable record for future reference, filled with helpful and often-revealing data - including 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.