When needing to know the monetary value of a home or a business, an appraiser (or real estate appraiser) is consulted. Appraisers are specially trained and knowledgeable in estimating and evaluating the marketable worth of the property in question. Since each state has special prerequisites when giving permits to become appraisers, in general appraisers only work in their home state.
There are several different methods used by certified appraisers, but they all must write out their appraisals so they can be easily understood. A report will include estimated value of property, date of the appraisal, the reason the appraisal was made and include the signature of the person who did the evaluation. Also, the address must be stated and some reports will include photographs and/or maps of the property.
What Are The Different Types Of Appraisals?
Reports can also differ in method. One may include a cost plan comparing expense of building something similar under current material costs. Also considered is land value and depreciation when making the appraisal.
Sometimes an appraiser uses a Direct Comparison, or Sales Comparison method where he compares what other similar properties or houses woud be selling for in the general area.
Another approach when appraising is estimating expected income the business could yield if run efficiently. Also he must consider the operating expenses when deciding the appraisal value.
Reasons For An Appraisal
There are many reasons an appraiser is consulted. One could be due to insurance purposes or a divorce may be in the process and they need a determination of property value for settlement issues. Appraisals may also be necessary when considering tax deductions if donating to charity. Other explanations might be when planning distributions of Estate finances, taxes on gifts or eliminating property for cash intentions.
When deciding on an appraiser, the client must have a specific purpose in mind as to the method he prefers his appraiser use in evaluating his home, business or property since there are such possible multiple choices the appraiser may use according to the client's preferences.
This Article is designed to be of general interest and should not be considered legal advice. The specific information discussed may not apply to you. Before acting on any matter contained herein, you should consult with your personal legal adviser.
