Difference between realtors and appraisers.

[Nancemoni]

I don't want to insinuate that realtor's and appraiser's are the same...I just wanted to know why there isn't a uniform way of listing a property? I mean a Realtor can say that there is 3000+ square footage in a house but once the appraiser comes in the buyers realize that there is really only 1500 square foot that can be claimed as livable. The same can be said about bedrooms and whether an area is considered finished or not.
I know each is governed by different sets of guidelines and rules, but it would just seem a lot easier and less confusing to the sellers and buyers to have everything the same...

Just wondering...
Thanks!

 

[MRL]

I am guessing you are talking about a rambler, split entry or split level style house with a basement.

The square footage the appraiser listed was propably the gross living area (GLA). GLA is finished square footage that is located on a level that is 100% above ground.

The realtor propably was talking about the finished square footage. Finished square footage can include the finished square footage below ground in it.

The square footage below ground is valued seperately. It is valued but at a different rate then the above ground square footage. The rooms above ground are also valued seperatly then the rooms below ground.

 

[Tom Woolford]

Appraisers will generally abide by ANSI atandards for measuring a home, and usually will be pretty consistent from one to another. Realtors probably have never been taught the righ or wrong of determining living area, and even if they were, probably will favor the largest number possible to make the listing more attractive.

 

[Ken B]

To add to the confusion, "Realtors" are members of the local association of Realtors and, through the local association, members of the State and National Association of Realtor.

There are various subcategories of Realtor. Members may be either salespeople, brokers, and/or appraisers. Not all real estate salespeople or brokers are Realtors and not all Realtors are salespeople or brokers.

So, to answer the question, one of the functions of a salesperson is to advertise their listing in a manner which is not misleading, but which depicts it in the most favorable and impressive manner possible. The not-quite-technical term is "puffing." A salesperson will puff up the property and make it seem "bigger than life." Some say puffing means blowing smoke up...well, you know.

Appraisers do not "puff" because appraisers are not trying to sell the property. Appraisers follow standardized methods of measuring and reporting property characteristics with the intent of portraying the subject and comparable properties factually and realistically.

Like all professions, salespeople and appraisers come in all levels of experience, education, and knowledge. I would not immediately characterize salespersons as inferior in knowledge or abilities compared to appraisers. However, due to differences in educational and experience requirements, it is true that most newly licensed agents are vastly less experienced and knowledgeable compared to newly licensed appraisers.

As a result of the different motivations and experience levels of the average salesperson and appraiser, I would lean towards whatever information provided to me by the appraiser should there be a discrepancy in the data.

 

[Dennis J. Black ASA IFAS]

Realtors are advocates, appraisers are not.

 

[Ted Martin]

Realtors sell houses and their descriptions are meant to present the property in the most favorable light.

Appraisers are more concerned with comparing apples to apples and use standard and procedures to bring consistency to the process.

Buyers are view a property in terms of their life style and how a property will meet those needs. Most buyers don't really buy houses or cars like they buy coffee or beans. What I mean is that coffee and beans are bought by the pound but cars aren't. By a similar token houses are not bought exclusively by the square foot. If they were we'd all be living in airplane hangers and barns, bigger houses are not always worth more.

As for "livable area", if you are referring to a home which as an example has 1500 SF on the main level and 1500 SF of finished area in the basement all three groups (buyers, Realtors, appraisers) would agree that the home has 3000 SF of "livable area". The appraiser's will be a little more specific in how they report and analyze the contributory value of each type of area. In may market for example area above the front door threshold (Above Ground Living Area) is adjusted at one rate and finished area below the front door threshold (basement finish) is adjusted at a different rate. I do this because that that is the way buyers react in my market. If you have an appraisal report you can look at, check the mouse print to the left of the sales grid at about the mid point of the grid and you will see how the lenders expect the appraiser to report the different types of finished area.

 

[The Warrior Monk]

When it comes to gross living area and salespersons, there is no consistency between agents or agencies. Some will measure the home (not common), some use assessor's info, and some simply guess (very common). Residential appraisers typically measure the home, though in some instances may uses other sources (e.g., plans for proposed construction, assessor's or building department records for no-inspection appraisals, etc.).

 

[Nancemoni]

Thanks everybody for their thoughts and expertise on this...I was just wondering cause it seems silly to me to have all these different ways to describe the house when it should just be in black and white.

I think Realtors give sellers and buyers a false hope sometimes by "puffing" the house up to be more than what it will appraise for. I don't think some do it intentionally but I think the few out there that do give the others a very bad name. It's like the old stereotype of a sleazy car salesman...

I'll keep reading threads on here to become better informed, cause you guys have no idea how informative this site is. I've been telling everyone I know about it!

Thanks for helping the :new_newbie: (newbie) out!

 

[Thomas Fiehler]

When it comes to Kentucky, all should be speaking the same language. About 3 years ago, the Kentucky legislature voted to incorporate ANSI guidelines into the real estate laws. Anyone building, appraising, leasing, or selling single family houses should report it that way. You might check with the local bord of Realtors or possibly call the Kentucky Appraisers Board for more information.