Term
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Definition
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Term
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Definition
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Term
| Techniques to estimating the cost to constuct the exisitng structure and site improvements. |
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Definition
- Comparative-unit
- Unit-in-place
- Quantity survey
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Term
| The amount of depreciation present is estimated using one or more of the three fundamental methods: |
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Definition
- Market extraction
- Economic age-life
- Breakdown
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Term
| Value of the fee simple interest... |
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Definition
| Value of the land is added to the cost of the improvement less depreciation |
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Term
| principal of contribution |
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Definition
| the value of an individual component of a property is measured in terms of how much it contributes to the value of the proeprty as a whole...and conversely, the value of a component may be measured as the amount its absence would detract from the property as a whole |
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Term
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Definition
- Use when
- lack of market activity limits the usefulness of the sales comparison approach
- relatively new construction with info on depreciation
- properties are not highly traded in the market
- insurance and taz purposes since land and improvements are analyzed seperatly
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Term
| What is indicated if the cost approach yields a higher value than the sales comparison or income capitalization approach? |
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Definition
| development is not economically feasible |
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Term
| Steps for the Cost Approach |
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Definition
- Estimate as though vacant and availible for highest and best
- Reproduction or Replacement
- Direct/Indirect
- Entreprenurial profit
- Add 2-4 to arrive at total cost of the improvements
- Estimate Depreciation
- 5 minus 6
- Estimate contributory value of any site improvements that have not already been considered
- Add site value to the total depreciaited cost of all improvments to develop the market value of the property
- Adjust for any personal property is included etc....
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Term
| The decision to use reproduction or replacement is dictated by... |
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Definition
| age of structure, uniqueness, and difference between its intended use at the time of construction and its current highest and best use |
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Term
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Definition
difference between the contributory value of an improvement and its cost at the time of appraisal
Reproduction/Replacement Cost
-Contributory Value of Improvement
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Depreciation |
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Term
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Definition
| wear and tear from regular use, the impact of the elements, or damage |
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Definition
| a flaw in the structure, materials, or design that diminishes the function, utility, and value of the improvement |
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Term
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Definition
| a temporary or permanent impairment of the utility or salability of an improvement or property due to negative influences outside the property |
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