WHAT IS AN APPRAISAL?
An appraisal is a professional appraiser's opinion of
value. The preparation of an appraisal involves research into
appropriate market areas; the assembly and analysis of information
pertinent to a property; and the knowledge, experience and
professional judgment of the appraiser. The role of the appraiser is
to provide objective, impartial and unbiased opinions about the
value of real property - providing assistance to those who own,
manage, sell, invest in and/or lend money on the security of real
estate.
At minimum, all states require
appraisers to be state licensed or certified in order to provide
appraisals to federally regulated lenders. Appraisers have fulfilled
rigorous educational and experience requirements and must adhere to
strict standards and a code of professional ethics. Qualified State
Certified appraisers bring knowledge, experience, impartiality and
trust to the transaction. In so doing, they help their clients make
sound decisions with regard to real property.
Most appraisals are reported in
writing, although in certain circumstances, an appraiser may provide
an oral appraisal. A written appraisal report generally consists of: a
description of the property and its locale; an analysis of the
"highest and best use" of the property; an analysis of sales of
comparable properties; and information regarding current real estate
activity and/or market area trends. The value indicated by recent
sales of comparable properties, the current cost of reproducing or
replacing a building, and the value that the property's net earning
power will support are the most important considerations in the
valuation of real property.
In addition to residential or
commercial appraisal - and depending upon an appraiser's designation
and qualifications - he or she may be able to assist with the
following:
