|
VALUATION
PROCESS
The valuation process
is a systematic procedure developed to produce well-researched
and well-supported estimates of real property value. The process
consists of a progressive series of steps, beginning with
the definition of the valuation problem. The process proceeds
through the collection of data pertinent to the problem's
solution, the selection and application of appropriate analytical
approaches, the reconciliation of value indications, and the
final estimate of value. It is completed when the value conclusion
is reported to the client. The steps in the process and the
methods of analysis are adaptable to many appraisal situations.
Although the valuation process is designed primarily for market
value appraisals, it provides a general framework for most
valuation assignments.
The valuation process
consists of seven basic steps, which are illustrated below:
Definition
of the Problem
Identification
of Real Estate
Identification of Property Rights to Be Valued
Date of Value Estimate
Use (Function/Purpose) of Appraisal
Definition of Value
Other Limiting Conditions
Preliminary
Analysis and Data Selection and Collection
| General
Data: |
Specific
Data(Subject and Comparables): |
| Social |
Site
and Improvements |
| Economic |
Sales
and Listings |
| Government |
Cost
and Depreciation |
| Environment |
Income/expense
and Capitalization Rate |
Highest
and Best Use Analysis
Land
as Though Vacant
Property as Improved
Land
Value Opinion
Application
of the Three Approaches
| Cost |
Sales
Comparison |
Income
Capitalization |
Reconciliation
of Value Indications and Final Value Opinion
Report
of Defined Opinion of Value
(Complete or Limited Appraisal;
Self-Contained or Summary or Restricted Report)
|
