Kardon Appraisals has answers to "Frequently Asked Questions"

Kardon Appraisals is always ready to elaborate on any concerns you might have about appraisals or real estate in Duval County. Feel free to contact us today.

What is an appraisal?
Describe what an appraiser does
Why would someone need a real estate appraisal?
Is an appraisal the same as a home inspection?
My agent performed a CMA for me. Is that the same as an appraisal?
What does the appraisal report contain?
Upon completion of the report, how can I have assurance that the value indicated is veritable?
How are appraisers certified?
Who employs appraisers?
Where does Kardon Appraisals get the data used to estimate values in Duval County or other areas?
Why do I need a professional appraisal?
What exactly is PMI and how can I get rid of it?
Do you need anything from the homeowner in advance?
How does an appraiser define "Market Value"?
Does the appraisal belong to the bank or the consumer?
Which home renovations add the most to the price?



What is an appraisal?   (Return to top)

The method of writing an appraisal deals with an inspection which forms an opinion of value. The real estate appraiser will use a number of "approaches," typically three, to come to the estimation of market value. The Cost Approach is one of the processes that real estate appraisers use to find value; it involves concluding what the improvements would cost without physical depreciation, adding the land value. The Sales Comparison Approach deals with searching for similar homes in close proximity and discerning value based on making a comparison of those properties to the house being investigated. Generally speaking, the Sales Comparison Approach is the most definite indicator of market value of a home. The third approach is the Income Approach, which is of most importance in appraising income producing properties - it involves estimating what an investor would pay based on the money generated by the property.

Describe what an appraiser does   (Return to top)

An appraiser produces a fair and credible determination of market value, to be used in making real estate transactions. Appraisers summarize their expert investigation in appraisal reports.


Why would someone need a real estate appraisal?   (Return to top)

There are a lot of reasons to order an appraisal from Kardon Appraisals with the usual reason being real estate and mortgage transactions. Other reasons for getting an report include:
  • To receive a loan.
  • If you would like to lower your property tax burden.
  • To build a case for a homeowner's equity and remove Primary Mortgage Insurance.
  • To contest improperly assessed property taxes.
  • To handle an estate.
  • To give you a leg-up when purchasing a home.
  • To figure out a reasonable property value when listing your home.
  • To defend your rights if your property is being taken by means of eminent domain in a condemnation case.
  • Because a government agency such as the IRS requires it.
  • It's possible you could be involved in a lawsuit - an appraisal will definitely help.
Click here for a more extensive explanation of the process about getting an appraisal.


Is an appraisal the same as a home inspection?   (Return to top)

Appraisers do not do complete residential property inspections and are not home inspectors. An inspection is a third-party evaluation of the accessible structure and systems of a home, from the top to the bottom. For the most part, a home inspection report will explain the amenities and the requirements of the property: air conditioning (weather permitting), electrical functions, the condition of the heating system, the plumbing; then the structural capacity of the home such as the attic, exposed insulation, walls, floors, ceilings, windows, then the foundation, basement and visible structures.

My agent performed a CMA for me. Is that the same as an appraisal?   (Return to top)

Simply put, it's night and day. What the CMA relies upon are vague trends. Appraisals use similar sales which are verifiable resources. The appraisal report will also include location and construction values. A CMA delivers a "ball park figure." An appraisal delivers a defensible and carefully documented opinion of value.

The person creating the report is frankly the most significant difference between a CMA and an appraisal. A CMA is created by a real estate agent who may or may not have a true grasp of the market or valuation concepts. A certified, Florida licensed professional who bases their livelihood on valuing homes in and around Duval County is behind the appraisal. Likewise, the agent has a vested interest in the property's selling price whereas the appraiser is bound by a code of ethics to collect only a previously agreed upon sum for assignments, regardless of their value conclusion.

What does the appraisal report contain?   (Return to top)

Every report should indicate a credible estimate of value and should identify the following:
  • The client and other intended users.
  • The intended use of the appraisal.
  • The purpose of the assignment.
  • Precisely what "value" attribute is being reported and what that value means.
  • The effective date of the appraiser's opinions and conclusions.(Sometimes this is in the past or maybe the future for new construction!)
  • Pertinent property attributes, including: location, physical attributes, legal attributes, economic attributes, the property rights valued, and non-real estate items included in the appraisal, such as personal property, trade fixtures and even intangible items.
  • All known easements, restrictions, encumbrances, leases, reservations, covenants, contracts, declarations, special assessments, ordinances, and other items of a similar nature.
  • Division of interest, such as fractional interest, physical segment and partial holding.
  • The scope of work considered to complete the assignment.
For a more in depth look at the work that goes into an appraisal report click here: Sample Appraisal Report


Upon completion of the report, how can I have assurance that the value indicated is veritable?   (Return to top)

In communicating an appraisal report, each appraiser must make sure of the following:
  • The appraisal used a suitable analysis of the information.

  • That critical errors of omission or commission were not committed individually or collectively.

  • That appraisal services were not conducted in a careless or negligent fashion.

  • The final appraisal report was transparent, sound and not easily discredited.
There are intense classroom and real world experience requirements that must be adhered to in order to achieve the title of "licensed appraiser" in Florida. In addition, appraisers must stick to a stringent industry code of ethics and comply with national standards of practice for real estate appraisal. The guidelines for developing an appraisal and reporting its results are guaranteed by enforcement of the Uniform Standards of Professional Appraisal Practice (USPAP).


   (Return to top) Regulations regarding licensing and certification of Real Estate Appraisers are different from state to state. In general, licensing and certification is most often associated with many hours of coursework, tests and real world experience. Once an appraiser is licensed, he or she is required to complete continuing education courses so that the license doesn't expire. To see the specific requirements for any state click here.

Who employs appraisers?   (Return to top)

Typically, appraisers are called upon by lenders to estimate the value of a house involved in a loan transaction. Appraisers also provide opinions for legal settlements, tax matters and investment decisions.

Where does Kardon Appraisals get the data used to estimate values in Duval County or other areas?   (Return to top)

One of the primary activities of an appraiser is to collect property data. Data can be described as either Specific or General. Specific data is taken from the home itself; Location, condition, amenities, size and other specifics are noted by the appraiser while on site.

General data is gathered from a numerous sources. Local Multiple Listing Services (MLS) provide data on recently sold homes that might be used as comparables. To verify actual sales prices, we look at items in the assessor's office and other public documents. Appraisers routinely have to report when a property is in a flood zone, and that information is retrieved from a FEMA data outlet such as a la mode's InterFlood service.

And last but not least, the appraiser gathers general data from his or her past experience in creating appraisals for other properties in the same market.


Why do I need a professional appraisal?   (Return to top)

Any time the value of your home or other real property is being used to make a significant financial decision, an appraisal helps. If you're selling your house, an appraisal will help you determine a price that maximizes profit and reduces time on the market. If you're buying, it makes sure you don't overpay. If you're engaged in an estate settlement or divorce, it ensures that property is divided fairly. A house is often the single, largest financial asset anybody owns. Don't make decisions in the dark with a professional appraisal.


What exactly is PMI and how can I get rid of it?   (Return to top)

PMI stands for Private Mortgage Insurance. PMI protects the lender in case a borrower defaults on the loan and the value of the home is lower than what is owed on the loan. Once you reach the point where your home's equity plus the amount you've paid is at least 20% of your loan balance, you can have your PMI dropped.

Did you have less than 20% to put down on your mortgage? Contact Kardon Appraisals today at (904) 737-8446 to see if you can get rid of your Private Mortgage Insurance payment.

Do you need anything from the homeowner in advance?   (Return to top)

The first step in most appraisals is the home inspection. During this process, the appraiser will come to your home and measure it, determine the layout of the rooms inside, confirm all aspects of the home's general condition, and take several photos of your house for inclusion in the report. On the home's interior, pick up any clutter and make sure we can find our way to things like furnaces and water heaters. On the outside, trim any landscaping so we can be free to get an accurate measurement of outside walls.

You can make our visit go faster and improve the quality of the appraisal report by having the following things on hand:
  • A plot plan or survey of the house and land (if readily available).
  • A list of any personal property that will be left behind and sold with the home, such as a oven, or a washer and dryer, if applicable.
  • Any paperwork, such as a title policy with information on encroachments or easements encroachments or easements.
  • A list of any major home improvements and enhancements, the date of their installation and their cost (for example, the addition of Energy efficiency upgrades or roof repairs) and permit confirmation (if available).
  • A copy of the current listing agreement and broker's data sheet and Purchase Agreement if a sale is "pending".

How does an appraiser define "Market Value"?   (Return to top)

In real estate appraising, Market Value (as opposed to Fair Market Value) is commonly defined as:

"The most probable price (in terms of money) which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: the buyer and seller are typically motivated; both parties are well informed or well advised, and acting in what they consider their best interests; a reasonable time is allowed for exposure in the open market; payment is made in terms of cash in United States dollars or in terms of financial arrangements comparable thereto; and the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale."



Does the appraisal belong to the bank or the consumer?   (Return to top)

In most real estate transactions, the appraisal is ordered by the lender. While the buyer pays for the report as part of the closing costs, the lender retains the right to use the report or any information contained within. The buyer is entitled to a copy of the report - it's usually included with all the other closing documents - but is not entitled to use the report for any other purpose without permission from the lender.

The exception to this rule is when a home owner engages an appraiser directly. In these scenarios, the appraiser may state how the appraisal can be used; for PMI removal, or estate planning or tax challenges, for example. If not noted otherwise, the home owner can use the appraisal for any purpose.


Which home renovations add the most to the price?   (Return to top)

Like all things real estate, this is dependent on a home's location. For example, if you live in a cold region, insulated windows can be a real plus. But they aren't as attractive in a warm-weather climate.

As a rule, the most value returned from renovating a home comes in the kitchen. According to one national survey, kitchen remodels returned an average of 88% of the investment. In other words, a $10,000 kitchen remodeling project would add approximately $8,800 to the value of the home. Bathrooms weren't far behind, returning 85%. Adding bedrooms and baths can also boost the value of your home (when done well) as long as your home doesn't then become atypical for your neighborhood in terms of size.