What Appears Simple May be Complex
by Administrator on Apr 12, 2017
Appraisers try to find comparable property sales that are in the immediate vicinity of the property they are trying to appraise. For residential appraisals they try to find a home built by the same builder, in the same year and in the same subdivision. In Henderson, Nevada you can often find the exact same model of home in a tract development. It's as close to being an exact match as possible. If you know what the matched property sold for in the last few months you are generally going to get very close to the market value of the subject.
Finding a nearly perfect comparable sale makes things relatively easy for an appraiser, they can feel good about the fact that they discovered a truely comparable property for their sales approach analysis. If its a residential property the model match can be an important indicator of value.
There are other properties, usually commercial, that are however much more difficult to match. Some, like motels, golf courses, ski hills, restaurants, resorts, RV parks and mobile home parks are not so easy. Appraisers may have to look beyond the boundaries of their city and maybe even beyond the boundarie of their state. I doubt that I can find a comparable sales for a Henderson or a Las Vegas property in the New York City real estate market but I may find them for some properties in Phoenix, Denver or Los Angeles.
For the appraiser properties that have few or no comparable sales in their local market area it takes a great deal more time and effort to complete an assignment. To be done correctly an appriser may have to travel to see one or more comparable sales. While Google maps may give you some idea about a comparable its not going to provide you with the detail that you need to complete a competent appraisal.
It's amazing just how complex what appears to be a simple property appraisal can become. As an example, you can take an assignment on an RV park and think to yourself "this looks like it's going to be easy." When you get into the analysis however you may discover that, for example, it has four specific types of rental spaces that all rent for different rates based on their improvements. The park may be located on a river and / or close to a highway that allows the park to maintain a certain level of volume and thus its rental income.
Many properties, like RV parks, are not simply real property, they include a business entity. Real property apprisers often accept appraisal assignment on motels, restaurants and RV parks without much thought for the business entity. The business entity may however have a significant impact on value.
For more appraisal information contact Glenn J. Rigdon MA, MRICS, ASA is a Las Vegas / Henderson Nevada based appraiser who can be contacted via email or via his business website known as Appraiser Las Vegas (http://www.appraiserlasvegas.com), or you can also click on “Contact Us” on the home page of this website or visit my public profile at LinkedIn at http://www.linkedin.com/pub/glenn-rigdon-ma-mrics-asa/1a/30b/879/
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