Faq

A real estate appraisal is an unbiased estimate of the value of a property, conducted by a qualified appraiser.

Appraisals are crucial because they help determine the fair market value of a property, which is essential for various purposes such as buying, selling, financing, taxation, and insurance.

Appraisals are often ordered by lenders when a property is being financed or refinanced. However, they can also be requested by property owners, buyers, sellers, real estate agents, attorneys, and government agencies for various reasons.

Appraisers typically conduct a physical inspection of the property to assess its condition and characteristics. They also research public records, recent sales data, and market trends to gather relevant information.

We have completed hundreds of appraisals over the years for Divorce cases as well as Partition Suits. We also offer court testimony as well as rebuttal research and appraisal reviews. These assignments are completed in two parts. The first is an appraisal of the property with an estimate of value and completion of a written appraisal report. The second part is litigation support and corresponding court testimony, if needed. This provides services as needed and helps reduce the total cost of services for these types of cases. The appraisals are often done for the client’s attorney but may be ordered on an individual basis.

Click here to download the CV

Upon developing an estimate of market value for a subject property, an appraiser can report his/her analyses, opinions, and conclusions using one of two allowed report formats. These are the Appraisal Report, and the Restricted Use Appraisal Report.  The essential difference between the options is the level of detail in the presentation of information.  The Restricted Use Report is used when the client is the only intended user.  The Appraisal Report offers a more concise presentation of information, while the Restricted Use Report represents the minimum in terms of the level of detail.

The value estimate may also be provided as a verbal report, if discussed and agreed upon with the client upon accepting the appraisal assignment.

Generally, three approaches to value would be considered by the appraiser during the appraisal process. These are the Direct Sales Comparison Method (Market Approach), the Cost Approach and the Income Approach. The Market Approach estimates the value by direct comparison with sales of similar properties. The Cost Approach estimates the current cost of replacing or reproducing the improvements, then subtracting the estimated depreciation from all causes and then adding the land value. The Income Approach is generally used for investment properties that are held for rental income. They may be houses, apartments, office buildings or warehouses. It is a value based on the properties earning power or income potential. It is derived by capitalizing the Net Income using an appropriate Cap Rate or using a discounted cash flow analysis or Yield Capitalization.

Usually, at least two of the approaches will be completed even with limited data as a check for reasonableness. However, in cases where only one approach is supportable, the Market Approach is generally used. It should be noted that the Market Approach is the method generally used by market participants for Residential properties.

The highest and best use of a property is typically evaluated under two scenarios, as though vacant and as improved. Each scenario is considered independently and must meet four criteria: legal permissibility, physical possibility, financial feasibility and maximum productivity. Analyzing the site as though vacant takes into consideration that any improvements can be demolished. It is useful in that it forms the basis for the site valuation, an integral part of the cost approach. Highest and best use as improved assesses the contribution of the existing improvements and examines whether they should be maintained, adapted or demolished.