Question: Does the appraised value of a property vary, depending upon whether the appraisal is preformed for the buyer or the seller?

Answer: The appraiser has no vested interest in the outcome of the appraisal and the estimated value should be objective and impartial.

Question: Are appraisers hired only to estimate real estate property values for purchase transactions requiring a mortgage?

Answer: Appraisers can and do provide a variety of services, including advice for estate planning, dispute resolution, tax assessment review and cost/benefit analysis.

Question: Does the market value approximate replacement cost?

Answer: Market value is based on what a buyer most likely would pay a seller for a particular property, with neither being under pressure to buy or sell. Replacement cost is the dollar amount required to reconstruct a property in-kind.

Question: Should assessed value equal the market value?

Answer: Assessed value does not equal market value due to a number of factors that are not know to the assessor. Examples how the assessed value might differ from the market value include; when interior remodeling has occurred and the assessor is unaware of the improvements; or when properties in the vicinity have not been re-assessed for an extended period of time.

Question: Do appraisers use a formula, such as a specific price per square foot, or consult a manual to figure out the value of a home?

Answer: Appraisers make a detailed analysis of all factors pertaining to the value of a home including its location, condition, size, proximity to facilities and recent sale prices of comparable properties in the subject market area.

Question: If consumers pay for appraisals when applying for loans to purchase or refinance real estate, do they own their appraisal?

Answer: The appraisal is, in fact, legally is owned by the lender or person/entity that orders the appraisal- unless the lender “releases its interest” in the document. However, consumers may obtain a copy of the appraisal report from their lender who had ordered the report under the Equal Credit Opportunity Act.

Question: In a strong economy, when the sales prices of homes in a given area are reported to be rising by a particular percentage, does the value of individual property in the same area be expected to appreciate by that same percentage?

Answer: The appreciation of a specific property must be determined on an individualized basis, factoring in data on comparable properties and other relevant details. This is true in strong/increasing or weak/decreasing markets.

Question: Is an appraisal the same as a home inspection?

Answer: An Appraisal does not serve the same purpose as a home inspection. The Appraiser forms an opinion of value in the appraisal process and resulting report. A home inspector determines the condition of the home and its major components and reports these findings.