An appraisal is an impartial estimate or opinion of value , usually written, of an adequately described property, as of a specific date, and supported by the presentation and analysis of relevant data. The value estimated is based ont eh selling price and listing of comparable properties. The Cost Approach estimates the cost of building a new building identical to the subject being appraised, at current prices, subtracting accumulated depreciation and adding the estimated land value. The Income Approach relates to income producing property and is based on the theory that value is the present worth of the income stream which the property is capable of producing when developed to its highest and best use. The net operating income is capitalized in a value by an appropriate method and rate.
Most people consider themselves Knowledgeable with regards to property values.
By either purchasing a house, or simply by owning real estate, they have formed an opinion of value. Usually this opinion is subjective. An independent real estate appraiser is a specialist who writes objective reports dealing with estimates of market value. The appraiser does not set or determine, or establishes value. A careful inspection of the property is made.