Appraisal Articles 2019 Free Appraisal Articles for Appraisers and the Public
While appraiser's do their best to conclude market value opinions that are accurate they can offer no guarantee. The problem with forming a market value opinion using appraisal methods is that even if you do everything "by the book," and the same as your peers, you can conclude a different value than they do. So how does it happen that one appraiser comes up with a dissimilar result or different value opinion than that concluded by another appraiser? There are many reasons that dissimilar results can result from a similar assignment. One appraiser may have a different somewhat subjective opinion about the condition of an improvements interior and exterior finish.
I'm always struck by how many people run to make the bed as I start taking interior photos of their home. I guess many homeowners and renters don't realize that appraisers must actually view and usually have to take photographs of the rooms in their home. I always tell them, because it's true, that I'm not looking at their bedding and the clothing that are sometimes scattered on the floor, I'm looking for cracked walls, water damage and deferred maintenance which usually are things that can't be fixed an hour or two just before the appraiser arrives and definitely not when I have arrived. I'm also looking at the overall condition of the building improvement but that usually means things like roofing, exterior paint, flooring wear, water damage, the condition of interior walls, kitchen cabinets and fixtures. Also important are the site improvements and whether the property is well-kept. If you collect old auto or parts I’m usually going to reduce the value to have a clean-up to br
One of the most difficult values that you may ever seek as a real property appraiser is a mineral-rights value. Mineral rights are one of the "sticks" in the bundle of rights that make up a fee simple interest. In some it appears obvious that a property has little mineral value while for others minerals may appear to have a substantial value. It's hard to argue that a property's highest and best use is not for mineral extraction when it has no infrastructure and its minerals have been valued by a Geologist at millions, but it's usually not as simple as that.
Appraisers are often asked this question with regard to the real estate owned by a business or a property owner. Of course, the answer for appraisers to this question is that profitability can have to do with many factors other than the simple difference that a real property move could make. If you make a move and it destroys a critical element of your business, then it wasn’t a successful move. Owners become compelled to answer the question about the profitability of moving when there is a party or multiple parties beating on their door with eye opening unsolicited offers.
Appraisal theory is much the same when valuing most things including general personal property, art (many specific kinds), antiques, machinery and equipment, gems / jewelry, business property and real property. Yes, there are many things that you have to know in any particular specialty area, but it’s not impossible for an appraiser to move from one appraisal specialty area to another, or for an appraiser to become competent in more than one area. You can’t become a modern art appraiser without developing a body of knowledge specific to that specialization. It generally takes years to acquire the education and understanding that you need just to step into an area with confidence, and there are usually a number of individuals who have dedicated their lives to any one specialty area. Individuals become so expert in a specialty area that they are sought out by others who are willing to pay for their expertise.
You are going to use that new industrial building that you just purchased for indoor tennis courts, and you want to know if those improvements will make the building worth more money? Or you already purchased and remodeled an industrial build to grow marijuana, and now it’s your opinion that those grow improvements are going to make it much more valuable. The problem that appraisers confront every day is that many parties who purchase industrial buildings and then modify them for a specialty purpose believe that there is an entire market full of people out there who are interested in purchasing the modified building, with its improvements, and they believe that there are many people willing to pay a premium for the improvements.
It is my opinion that there are some Pahrump real property owners who wish the 2004 implementation of the zoning ordinance didn’t happen. Some property owners in Pahrump wanted to see the town move into the future with rules and regulations, like those in place in larger cities, while others liked the Wild West, and the unregulated nature of the Town before 2004. So Pahrump ended up with zoning with lots of exceptions in outlying areas for existing commercial, industrial and mixed uses. Many other properties that were not zoned for their existing uses in the ordinance but they were allowed to continue in their non-conforming uses. There are many residents in Pahrump who are just starting to realize that after almost 15 years they can’t continue to run their businesses out of the same buildings that were old in 2004, and the buildings are really old in 2019. It’s dawning on those owners that their residential zoning may actually negatively impact their property value. Even if
Many investors and owners never take the time to really analyze a location. They consider the price of a parcel of land or the price per square foot of a retail or office building but many don’t take the time to draw a 1 mile radius around it and consider how many potential customers they have nearby or what their socio-economic status of the people who live there is. That’s a recipe for disaster for businesses who must survive there. In my neighborhood for example there is a huge area that is vacant, federally owned land, basically it’s a mountain that falls into the McCullough Range, and it’s like a black hole for business owners. The area where the mountain is takes up thousands of acres of land that would normally be developed with homes and apartment buildings but instead there is nothing.