What is an appraisal?
An appraisal is a thought process leading to a value conclusion.
What does an appraiser do?
The fundamental role of an appraiser is to provide a professional opinion, usually an estimate of value. Appraisers develop appraisal reports that are the conveyance to another of the appraiser’s analysis of the data that affects the valuation.
Each report must identify the following:
- The client and other intended users.
- The intended use of the report.
- The purpose of the assignment.
- The type of value reported and the definition of the value reported.
- The effective date of the appraiser's opinions and conclusions.
- Relevant property characteristics, including location attributes, physical attributes of the property interest valued, and Non real estate items included in the appraisal, such as intangible items.
- All known: easements, restrictions, encumbrances, leases, reservations, covenants and restrictions, ordinances, and other items of a similar nature.
- Division of interest, such as fractional interest, physical segment and partial holdings.
- The scope of work used to complete the assignment.
Each report must reflect a credible estimate of value.
In communicating an appraisal report, each appraiser must ensure the following:
- That the information analysis utilized in the appraisal was appropriate.
- That significant errors of omission or commission were not committed.
- That appraisal services were not rendered in a careless or negligent manner.
- That a credible, supportable appraisal report was communicated.
Who do appraisers work for?
Typically, appraisers are employed by lenders to estimate the value of real estate, to give opinions in litigation cases, tax matters and investment decisions or to help property owners set sale prices before marketing their property.
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