PROFESSIONAL APPRAISAL Real estate appraisal (a.k.a. “property valuation”) is the process of developing an opinion of value for real property. This is the “market value,” or what a willing reasonable buyer would pay for the property to a willing reasonable seller. Real estate transactions almost always require appraisals because they occur infrequently on a given property and every property is different or unique in features and characteristics. An appraisal helps in various decision points. The seller can use the appraisal as a basis for pricing. The buyer can use it on which to base an offer. Lenders use appraisals to know how much money to credit to their borrowers. The most important factors in a house appraisal are: ; ; dwelling type (e.g., one-story, two-story, split-level, factory-built) ; ; features (including design); materials used and the type of structure present and how they were built ; ; improvements made ; ; comparable sales ; ; location — type of neighborhood, zoning areas, proximity to other establishments ; ; age of property ; ; size ; ; depreciation Condition, of course, is a crucial factor in valuation. Location is also a factor, but as property can’t change location, it’s often upgrades or improvements to a residential property that can enhance its value.
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