Myths & Realities About Real Estate Appraisals

MythAssessed value should equal market value.

RealityWhile many states aim for assessed value to approximate market value, this often isn't the case — especially after remodeling the assessor isn't aware of, or when properties in an area haven't been reassessed in years.

MythThe appraised value changes depending on whether the appraisal is for the buyer or the seller.

RealityA licensed appraiser has no vested interest in the outcome and renders the same independent, objective, impartial opinion no matter who requested it.

MythMarket value should approximate replacement cost.

RealityMarket value is what a willing buyer would actually pay a willing seller, with neither under pressure. Replacement cost is simply what it would take to rebuild the property from scratch — a different number entirely.

MythAppraisers use a formula, like a fixed price per square foot, to determine value.

RealityValue comes from a detailed analysis of location, condition, size, proximity to amenities, and recent comparable sales — never a flat per-square-foot number.

MythIf home values in an area are rising by a certain percentage, every property in that area appreciates by the same amount.

RealityAppreciation has to be determined property by property, based on its own comparable sales and characteristics — in both rising and falling markets.

MythYou can tell what a property is worth just by looking at the outside.

RealityValue depends on location, condition, improvements, amenities, and current market trends — most of which you can't see from the curb.

MythWhoever pays for the appraisal owns the report.

RealityIt depends on who ordered it. When you hire Richard directly — for an estate, a divorce, a tax appeal, or any other non-lender purpose — the report is yours, plain and simple. It's only on lender-ordered appraisals that the lender legally owns the report, though consumers are still entitled to a copy upon written request under the Equal Credit Opportunity Act.

MythAs long as an appraisal satisfies whoever ordered it, the details inside don't matter.

RealityReading your own report lets you double-check its accuracy and understand exactly what's in it — the legal and physical property description, square footage, comparable sales used, and a narrative on current market activity in your neighborhood. It's a genuinely useful record to keep.

MythAppraisers are only hired for mortgage-related property sales.

RealityAppraisers regularly provide value for estate planning, divorce settlements, tax assessment appeals, zoning matters, and cost/benefit analysis — no mortgage required.

MythAn appraisal is the same as a home inspection.

RealityAn appraisal forms an opinion of value. A home inspection evaluates the physical condition of the home and its major systems. They serve two entirely different purposes.