Accuracy of an appraisal

We usually assume that a real estate appraisal should be an accurate measurement of the worth of a property and that the property only has one precise value. Buyers and financiers often run into trouble when lenders use an appraisal management company to hire an appraiser who doesn’t have local experience that could affect home values.

One major factor that must be understood is that appraising a property is divided into scientific, mathematics, experience and subjective qualities. Note that three ordinary appraisers can appraise the same property and arrive at three different values; three excellent appraisers with knowledge of a local area may arrive at three different values but the differences would be very slight. The main part of an appraisal is obviously the subject property. The appraiser inspects the property, measuring the total living area, and creates a sketch of any structures. He notes the location, any adverse elements that may impact value such as flight paths, busy roads or any commercial developments. The purpose of an appraisal is not to determine the exact value of the property, but rather to inform the bank if the property supports the liability, the mortgage, that is being applied for by the borrower.

There are inexperienced appraisers; those having the minimal training to qualify for licensing or simply do not have the background to tackle complex issues. Those with less experience, often find themselves less equipped to address difficult assignments and sometimes provide value opinions that are less accurate than those of seasoned appraisers. In some markets where conditions are good, appraisals should be within two or three percent of other appraised values. In others where market conditions are challenging and hard to predict, a 10 percent variance may be welcomed.

It all depends on the case. All cases have different stories. The appraiser, who is assigned a project and given proper inspection access, time, budget and direction, may be held to a higher standard than some else with limited time and knowledge. Further, the appraiser should be given the proper resources, including time, budget and property access, to complete the assignment in a professional manner. Adverse market conditions are harder to overcome in rendering the most accurate appraisal, except for the fact that the best appraiser is likely to do the best job.

Hire the best appraiser in New York to get an accurate appraisal for your property.