Basic Real Estate Appraisal

by Betts, Richard M.

• ISBN13: 9780324201468
• ISBN10: 032420146X
• Edition: 6th
• Format: Paperback
• Copyright: 2004-07-26
• Publisher: Cengage Learning

Summary

Mastering real estate appraisal has never been easier. This ever-popular resource, based on the authors’ combined wealth of both professional and academic experience, continues to provide a thorough outline of the most up-to-date appraisal theory and practice for students, real estate professionals and consumers. Both simple and complex subjects are covered in terms that are easy to understand and accurate. This book references and explains the Uniform Standards of Professional Appraisal Practice, introducing all of the appraisal related topics listed in educational requirements for universal state licensing and certification. Master real estate appraisal like a professional.

Table of Contents

Meeting the Authors	vi
Preface	vii
Acknowledgments	viii
Real Estate Appraisal and You	1	(12)
What Is an Appraisal?	2	(2)
How Appraisals Are Used	4	(2)
Standards of Appraisal Practice	6	(2)
Developing Appraisal Skills	8	(5)
Legal Considerations in Appraisal	13	(20)
Physical and Legal Characteristics of Real Estate	16	(3)
Use Restrictions	19	(4)
Property Descriptions	23	(10)
The Formal Appraisal Process	33	(26)
Introduction	34	(7)
Steps in the Appraisal Process	41	(4)
Types of Value	45	(4)
The Classical Approaches to Value	49	(10)
Focus on Neighborhood, Community, and Market	59	(26)
Neighborhood Analysis	59	(10)
Understanding Communities and How They Grow	69	(8)
Real Estate Markets and Their Analysis	77	(8)
Real Estate Economics and Value	85	(20)
The Basic Value Influences	85	(4)
How Economic Trends Affect Real Estate	89	(7)
The Economic Principles of Valuation	96	(9)
Property Inspection and Analysis: The Site	105	(34)
Preparing to Inspect the Site	105	(4)
Highest and Best Use Analysis	109	(3)
Major Categories of Site Information	112	(15)
Computing Area and Volume	127	(12)
Property Inspection and Analysis: The Improvements	139	(26)
Planning the Building Inspection	139	(5)
Performing the Building Inspection	144	(6)
Understanding Construction Details	150	(7)
Functional Utility and Architectural Styles	157	(8)
The Sales Comparison Approach	165	(28)
Introducing the Sales Comparison Approach	165	(4)
Collecting Comparable Sales Data	169	(16)
Data Resources on the Internet	185	(2)
Appraisal Statistical Concepts	187	(6)
Analyzing and Adjusting Comparable Sales	193	(30)
Basic Methods of Comparing Sales	193	(7)
Selecting and Using Units of Comparison	200	(7)
How to Estimate Dollar and Percent Adjustments	207	(7)
Arriving at an Indicated Value	214	(9)
Valuing the Site	223	(20)
Purpose of Land or Site Value Estimates	223	(2)
The Four Methods Used to Appraise Land	225	(7)
How to Use Market Comparison Techniques	232	(11)
Introducing the Cost Approach	243	(24)
Use of Cost Estimates in Appraisals	244	(4)
Practical Cost-Estimating Methods	248	(3)
Understanding Direct and Indirect Costs	251	(4)
Important Factors Affecting Building Cost	255	(12)
Estimating Loss in Value: Accrued Depreciation	267	(18)
Depreciation Defined	267	(2)
Types and Causes of Accrued Depreciation	269	(5)
Methods of Measuring Accrued Depreciation	274	(6)
Cost Approach Summary	280	(5)
The Income Approach	285	(26)
Introducing Income Property and Its Appraisal	286	(5)
Gross Rent Multiplier Analysis	291	(2)
Estimating Gross Income and Market Rent	293	(7)
Operating Expenses and Expense Ratios	300	(4)
Reconstruction of the Operating Statement	304	(7)
Income Capitalization: Rates and Techniques	311	(30)
Purpose and Theory of Capitalization	311	(7)
Selection of the Capitalization Rate	318	(8)
Direct and Residual Capitalization Techniques	326	(6)
Estimating, Measuring, and Discounting Cash Flows	332	(9)
Reconciling the Value Estimates	341	(10)
General Review of the Appraisal	341	(1)
Reconciling the Value Approaches	342	(5)
Rounding the Answer	347	(4)
Reporting Appraisal Opinions	351	(42)
The Form and Content of Appraisal Reports	352	(2)
Reporting Options Available Under USPAP	354	(2)
Traditional Formats of Written Appraisal Reports	356	(6)
Writing the Narrative Appraisal Report	362	(31)
Appraising Special Ownerships and Interests	393	(26)
Condominiums and Other Specialized Housing	394	(9)
Valuation of Partial Interests	403	(6)
Valuation for Eminent Domain	409	(10)
The Professional Appraiser	419	(24)
The Appraiser's Background	419	(5)
State License and Certification Requirements	424	(3)
Appraisal Groups	427	(5)
Standards of Professional Appraisal Practice	432	(3)
Appraising as an Occupation	435	(8)
Answers to Reviewing Your Understanding	443	(2)
Glossary	445	(18)
Index	463