The Art of Real Estate Appraisal: The Complete Guide for Homeowners and Real Estate Professionals
Real estate appraisals are one of the primary factors in the mortgage decision making process for lenders. Now consumers and real estate agents have a guide to lead them through the process so that they're prepared with accurate knowledge of their property's price even before the professional appraisal.
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Real estate appraisals are one of the primary factors in the mortgage decision making process for lenders. Now consumers and real estate agents have a guide to lead them through the process so that they're prepared with accurate knowledge of their property's price even before the professional appraisal.
Preface viiIntroduction ixReal Estate and Its Appraisal 1What Is a Real Estate Appraisal? 2Land versus Site 7Real Estate and Real Property 9Public Restrictions on Land Use 9Private Restrictions on Land Use 10Personal Property 11The Real Estate Marketplace 15Recent History 15The Subprime Mortgage Crisis 16Market Value 18Value Principles 20The Appraisal Process 29Sales Comparison Approach 29Cost Approach 31Income Capitalization Approach 32Relationship of Approaches 35Steps in the Appraisal Process 36Summary 38Data Collection and the Data Bank 41The Appraisal Process 41The Data Bank 42Data Forms 49The Neighborhood and the Home 61Residential Construction and Home Inspection 69Site 69Building Codes 71Plans and Specifications 71Architectural Styles 71House Types 72Interior Design 75Foundation 79Framing 83Exterior Trim 83Roof Coverings 83Exterior Siding 86Insulation 89Exterior Windows and Doors 90Interior Walls and Finishing 95Plumbing 95Heating and Air-Conditioning 96Electrical System 99The Sales Comparison Approach 103Basics of the Sales Comparison Approach 103Appraisal Process 104Applying the Sales Comparison Approach 104Site Valuation 127Separate Site Valuations 128Site Data 129Methods of Site Valuation 134The Cost Approach 143The Theory Behind the Cost Approach 143Applying the Cost Approach Formula 145Reproduction Cost versus Replacement Cost 145Finding the Reproduction Cost 147Accrued Depreciation 151Itemizing Accrued Depreciation 156Cost Approach Using the URAR Form 158Usefulness of the Cost Approach 158The Income Capitalization Approach 163Determining Income 164Selecting the Capitalization Rate 169Selecting the Capitalization Technique 170Gross Income Multiplier 172Reconciliation and the Appraisal Report 177Reconciliation 177Types of Appraisal Reports 181Final Comment 182Calculating Area 189Glossary 199Index 219
