Basic Appraisal Procedures – McKissock
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Valuation process
A systematic procedure used in the valuation of real property.
Client
The party or parties who engage, by employment or contract, an appraiser in a specific
assignment.
Steps in Defining the problem
Identification and location of the real estate; Identification of the property rights; Definition of
value; Purpose and intended use of the appraisal; Effective date of the opinion of value; Any
special limiting conditions
Real property
The interests, benefits, and rights inherent in the ownership of real estate.
,Market Value
A type of value, stated as an opinion, that presumes the transfer of a property (i.e., a right of
ownership or a bundle of such rights), as of a certain date, under specific conditions set forth in
the definition of the term identified by the appraiser as applicable in an appraisal.
Intended Use
The use or uses of an appraiser's reported appraisal or appraisal review assignment opinions
and conclusions, as identified by the appraiser based on communication with the client at the
time of the assignment.
Intended User
The client and any other party as identified, by name or type, as users of the appraisal or
appraisal review report by the appraiser on the basis of communication with the client at the
time of the assignment.
Effective Date of the Value
The ____________ can be a past (retrospective), current or future (prospective) date. This
decision will be made in concert with the client's needs.
Extraordinary assumption
An assumption, directly related to a specific assignment, as of the effective date of the
assignment results, which, if found to be false, could alter the appraiser's opinions or
conclusions.
, Hypothetical Condition
A condition, directly related to a specific assignment, which is contrary to what is known by the
appraiser to exist on the effective date of the assignment results, but is used for the purpose of
analysis.
Scope of work
The type and extent of research and analyses in an assignment.
Workfile
Documentation necessary to support an appraiser's analyses, opinions, and conclusions
Steps in the Valuation Process
1. Define the problem 2. Determine scope of work 3. Gather, record, and verify the data 4.
Determine the highest and best use 5. Estimate the land value 6. Estimate value by each of the
three approaches (if applicable) 7. Reconcile the estimated values into the final opinion of value
8. Report the final opinion of value
Highest and Best Use Criteria (in order)
1. Legally permissible 2. Physically possible. 3. Financially feasible. 4. Maximally productive
Questions With Detailed Verified Answers
(100% Correct Answers) /Already Graded
A+
Valuation process
A systematic procedure used in the valuation of real property.
Client
The party or parties who engage, by employment or contract, an appraiser in a specific
assignment.
Steps in Defining the problem
Identification and location of the real estate; Identification of the property rights; Definition of
value; Purpose and intended use of the appraisal; Effective date of the opinion of value; Any
special limiting conditions
Real property
The interests, benefits, and rights inherent in the ownership of real estate.
,Market Value
A type of value, stated as an opinion, that presumes the transfer of a property (i.e., a right of
ownership or a bundle of such rights), as of a certain date, under specific conditions set forth in
the definition of the term identified by the appraiser as applicable in an appraisal.
Intended Use
The use or uses of an appraiser's reported appraisal or appraisal review assignment opinions
and conclusions, as identified by the appraiser based on communication with the client at the
time of the assignment.
Intended User
The client and any other party as identified, by name or type, as users of the appraisal or
appraisal review report by the appraiser on the basis of communication with the client at the
time of the assignment.
Effective Date of the Value
The ____________ can be a past (retrospective), current or future (prospective) date. This
decision will be made in concert with the client's needs.
Extraordinary assumption
An assumption, directly related to a specific assignment, as of the effective date of the
assignment results, which, if found to be false, could alter the appraiser's opinions or
conclusions.
, Hypothetical Condition
A condition, directly related to a specific assignment, which is contrary to what is known by the
appraiser to exist on the effective date of the assignment results, but is used for the purpose of
analysis.
Scope of work
The type and extent of research and analyses in an assignment.
Workfile
Documentation necessary to support an appraiser's analyses, opinions, and conclusions
Steps in the Valuation Process
1. Define the problem 2. Determine scope of work 3. Gather, record, and verify the data 4.
Determine the highest and best use 5. Estimate the land value 6. Estimate value by each of the
three approaches (if applicable) 7. Reconcile the estimated values into the final opinion of value
8. Report the final opinion of value
Highest and Best Use Criteria (in order)
1. Legally permissible 2. Physically possible. 3. Financially feasible. 4. Maximally productive
