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In addition to establishing the fair market value of a property, a comprehensive appraisal provides:
Comparative information on other similar properties
An assessment of the area's overall real estate market
An estimate of the sale time for the property
An expert evaluation of potentially harmful issues associated with the property

The Appraisal Process

When a client orders an appraisal, an appraiser will be assigned to the case. The appraiser will take the following steps during the appraisal process:

Step 1: Gather Information

The appraiser will gather the following documents and information, among other things, from either the client or public records:

Deed to the property
Survey of the property
Purchase agreement
Land and building descriptions
Real estate tax bill
Information about the area where the property is located
Data regarding sales of comparable properties in the area
Current market trends/supply-and-demand data
Cost of replacing the structure

Step 2: Analyze Information

The appraiser will then analyze the above-mentioned data to form an objective opinion as to an estimated value of the property. The appraiser forms an estimate of the value by taking three common approaches:

Cost Approach, which takes into account replacement/rebuilding costs
Comparison Approach, which takes into account comparable properties
Income Approach, which takes into account the net income the property produces (for appraisals of rental properties)

Step 3: Write & Certify Report

The appraiser will put his or her value estimate in writing, in compliance with the Uniform Standards of Professional Appraisal Practices (USPAP). The appraisal will include the following information:

Purpose of appraisal
Description of the property
The date the value estimate is made
Description of physical attributes of the property
Statement about any known encumbrances, if applicable
Statement of the highest and best use of the property
Statement regarding property rights
Statement of cost approach and analysis, if applicable
Statement of direct sales comparison approach and analysis, if applicable
Statement of income approach and analysis, if applicable
Statement about conclusions reached
Minimum documentation required to support the appraisal
Statement of any assumption and limiting conditions affecting appraisal
Appraiser's signature and designations
Confidentiality statement
Education status of appraiser, if a designated member

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