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Definition
| independent professional trained to provide an unbiased estimate of value in an impartial and objective manner |
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Definition
Competitive Market Analysis
an analysis of the property but it is not an appraisal and should not be presented as such |
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Definition
Brokers Price Opinion
similar to CMA but includes more detailed information
brokers usually charge for a BPO even though it is not an appraisal |
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Definition
| value created by the expectation that certain cvents will occur |
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Definition
| the concept that possible / predictable events might change the marketplace for the subject property |
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Definition
| the interaction of supply and demand |
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Definition
| value is created when a property is in harmony with its surroundings |
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Definition
| the value of any part of a property is measured by its effect on the value of the whole; i.e., what value does an improvement add to the property |
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Definition
| the most profitable single use to which a property may be put |
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Term
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Definition
criteria to determine the HABU, highest and best use
(1.) physically possible
(2.) legally permitted
(3.) economically or financially feasible
(4.) most profitable or maximally productive |
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Term
| What is the first item on an appraisal |
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Definition
| State the Problem or why is the appraisal being conducted |
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Term
| What is the last item on an appraisal? |
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Definition
| Report the final value estimate |
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| Determining Value in the Market |
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Definition
DUST
Demand
Utility
Scarcity
Transferability |
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Term
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Definition
| The most probable price a knowledgeable buyer is willing to pay, a knowledgeble seller is willing to accept for property in a competitive and open market, with neither party under duress |
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Definition
| opinion of value based on an analysis of data |
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Definition
| price the property actually sells for--the sales price |
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| Is Market Value & Cost synonymous |
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Definition
| Perhaps on new construction but not generally on existing stock |
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Term
| Increasing & Diminishing Returns |
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Definition
Increasing--when improvements add value equal to the cost
Diminishing --when improvements do not add value equal to the cost |
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Term
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Definition
| consolidating of lots or plots that creates a value greater than the sum value of the lots before consolidated |
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| Regression and Progression |
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Definition
| property values increasing or decreasing based on the presence of better or lesser value property |
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Term
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Definition
| maximum value of a property tends to be set by how much it would cost to purchase an equally desirable and valuable substitute property |
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Definition
| value of a property depends on the number of properties available in the marketplace |
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Term
| Three approaches to value |
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Definition
(1.) sales comparison approach
(2.) cost approach
(3.) income approach |
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Term
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Definition
same as comparables
comparison of the subject house to others in the area recently sold
considered the most reliable method |
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Term
| Adjustments to Sales Comparison / Comparables Approach |
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Definition
(1.) Property rights
(2.) Financing concessions
(3.) Market conditions
(4.) Conditions of sale
(5.)Market conditions since the date of sale
(6.) Location
(7.) Physical features and amenities |
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Term
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Definition
| cost of constructing an exact duplication |
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Definition
| cost of replacing the property with a similar home but not an exact duplicate |
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Term
| Determining reproduction or replacement cost |
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Definition
(1.) square-foot method
(2.) unit in place method
(3.) quantity survey method
(4.) index method |
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Term
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Definition
| if the comp is poorer, ADD |
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Definition
| if the comp is better, substract |
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Term
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Definition
| Loss of value for any reason |
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Term
| What are the three categories of depreciation |
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Definition
(1.) physical deterioration
(2.) functional obsolescence
(3.) external obsolence |
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Term
| Is external obsolence curable? |
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Definition
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Term
| Is Functional Obsolence curable? |
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Definition
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