WHAT IS AN APPRAISAL?

An appraisal is a thought process leading to an opinion of value.� This opinion or estimate is arrived at through a formal process that typically uses the three “common approaches to value”.� They are the Cost Approach – which is what it would cost to replace the improvements, less physical deterioration and other factors, plus the land value.� There is the Sales Comparison Approach – which involves making a comparison to other similar nearby properties which have recently sold.� The Sales Comparison Approach is normally the most accurate and best indicator of value for a residential property.� The third approach is the Income Approach – which is of most importance in appraising income producing properties – it involves estimating what an investor would pay based on the income produced by the property.

WHY GET AN APPRAISAL?

�Every year, people all over the country buy, sell or refinance their homes.� Most, if not all, of these transactions will require an appraisal to be completed.� This is not the only reason to get an appraisal.� The following are just some of the reasons any individual may need an appraisal:

• To establish replacement cost of insurance
• Property tax challenges
• Pre-Sale decisions
• Estate Planning, Liquidation or Divorce