Appraiser Talk com: Appraisal Principals - Appraiser Talk com

Appraisal Math & Statistics

The financial calculator. Area calculation. Volume calculation. Reciprocals. Percentages. Mean. Median. Mode. Range. Standard deviation. Weighted average. Population & samples. Regression analysis. Living area calculations. Dollar adjustments. Percentage adjustments. Time value of money. Future value of $1.00 (compounding). Present value of $1.00 (discounting). Future value of $1.00 per period. Present value of $1.00 per period. Period payment to grow to $1.00 (sinking fund factor). Cash equivalency. Points paid by seller. Favorable seller financing. Mortgage buydowns. Real estate commissions. Closing costs. Calculation of mortgage payment. Calculation of mortgage term. Calculation of mortgage interest rate. Calculation of mortgage constant.

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Economic Characteristics of Value

Demand unit. Desirability utility. Effective purchasing power. Scarcity. Transferability.

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Economic Principals of Value

Anticipation. Balance. Change. Competition. Conformity. Consistent use theory. Contribution. Economics of scale. Externalities. Highest and best use. Increasing and decreasing returns. Opportunity costs. Plottage. Regression & progression. Substitution. Supply & demand. Surplus productivity.

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Estates in Land (bundle of rights)

Freehold estate. Leasehold estate. Fee simple estate. Fee simple absolute. Fee simple defeasible. Condition of subsequent. Right of reentry. Possibility of reverter. Special limitation (fee simple determinable). Life estate. Remainder interest. Reversionary interest. Legal life estate. Dower & curtesy. Homestead. Life tenant. Waste. Possession & duration. Bundle of rights. Right of possession. Right to control the property. Right of enjoyment. Right of exclusion. Right of disposition. Right to sell. Right to lease. Right to mortgage. Right to sell or lease partial interest. Right to build improvements. Right to do nothing.

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Forms of Property Ownership

Sole ownership. Ownership in severalty. Co-ownership. Tenancy in common. Undivided fractional interest. Joint tenancy. Unity of ownership. Right of survivorship. Tenancy by the entirety. Community property. Partnership property. Trust, trustee, trustor & beneficiary. Fiduciary. Trust companies. Real estate investment trust (REIT). Living trust. Testamentary trust. Land trust. Syndicates. Joint ventures. Condominium. Cooperative. Planned unit development (PUD). Time share. Unity of possession. Unity of interest. Unity of time. Unity of title.

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Forces on Real Estate Value

Social forces. Economic forces. Physical & environmental forces. Governmental forces. Population trends (growth, decline, stability). Family composition. Aging of America’s population. Evolution of home offices. Environmental consciousness. Security consciousness. Leisure time. Income levels. Employment. Housing construction costs. Credit availability. Interest rates. Utility costs. Location. Transportation. Topography. Climate & weather. Taxes. Federal monetary policy. Real estate taxes and assessments. Labor issues. Quality of schools & services.

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Fundamental Conditions of Market Value

Buyer & seller are typically motivated. Both parties are well informed. Reasonable time. Payment in cash. Normal consideration.

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Governmental Powers (control of land use)

Police powers. Environmental laws. Zoning ordinances. Building codes. Regulations regarding use, occupancy, size, location & construction of real estate. Eminent domain. Condemnation. Taxation. Escheat.

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Highest and Best Use

Highest present land value. Land as though vacant. Physically possible. Legally permissible. Financially feasible. Maximally productive. Property as improved. Interim use. Holding. Plottage. Excess land. Surplus land.

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Land & Site Valuation

Influences on land and site valuation. Physical characteristics. Zoning and/or deed restrictions. Availability, capacity and proximity of utilities. Site improvements. Techniques for site valuation. Allocation. Extraction. Sales comparison. Subdivision development. Ground rent capitalization. Land residual.

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Legal Descriptions

Methods of describing real estate. Metes-and-bounds method. Point of beginning (POB). Monuments. Government (rectangular) survey. Principal meridians. Base lines. Longitude & latitude. Townships. Township lines. Township strips. Ranges. Range strips. Sections. Halves & quarters. Correction lines. Government check. Fractional sections. Standard sections. Government lots. Lot-and-block. Recorded plat. Plat map. Survey plat. Lots & blocks. Subdivision plat. Exact boundaries. Licensed surveyor. Survey. Survey sketch. Spot survey. Benchmarks. Datum. Air lots.

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Liens & Judgments

Voluntary lien. Involuntary lien. Statutory lien. Equitable lien. General liens. Judgments, estate & inheritance taxes. Debts of decedent. Corporation franchise taxes. Internal Revenue Service taxes. Specific liens. Mechanic liens. Expressed & implied contract. Notice of non-responsibility. Mortgage liens. Tax lien. Special assessment lien. Utility lien. Estate & inheritance tax lien. Writ of execution. Judgment lien. Date of judgment. Satisfaction of judgment. Writ of attachment. Lis pendens. Notice of possible future lien. Priority of liens. Date of recording. Subordination agreements.

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Real Estate Taxes

Ad Valorem tax. Assessors & assessments. Board of appeals. Board of review. Equalization. Equalization factor. Tax Rate. Adoption of a budget. Appropriation. Tax levy. Mill ratio. Tax bills. Levied properly, legal purposes & applied equitably. Tax sale. Right of redemption. Certificate of sale. Equitable right of redemption. Statutory right of redemption. Tax deed.

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Recording of Title

Eligible for recording. Notice. Constructive notice. Actual notice. Priority. Chain of title. Suit to quite title. Title search. Abstract of title. Abstractor. Marketable title. Evidence of title. Certificate of title. Attorney’s opinion of title. Title insurance. Right of subrogation. Torrens system. Uniform Commercial Code (UCC). Security agreement. Financing statement (UCC-1).

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Restrictions, Easements & Encroachments

Deed restrictions. Covenants, conditions & restrictions (CC&R). Easements. Appurtenant easement. Servient tenement. Dominant tenement. Party wall easement. Easement in gross. Right of way easement. Utility easement. Easement by necessity. Easement by prescription. Tacking. Easement by condemnation. Creating an easement. Terminating an easement. License. Encroachments. Air rights. Appearance rights. Development rights. Farming rights. Grazing rights. Hunting rights. Littoral rights. Accretion & avulsion. Mineral rights. Right of possession. Riparian rights. Runoff rights. Surface & subsurface rights. Timber rights. Water rights.

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Transfer of Title

Evidence of ownership. Voluntary alienation. Deed. Grantor & grantee. Consideration. Granting clause. Words of conveyance. Habendum clause. Limitations on conveyance. Accurate legal description. Exceptions & reservations. Delivery & acceptance of deed. Legal age and of sound mind. Love & affection. To have and to hold. Acknowledgment. Notary public. Seal. Cloud on the title. Covenants & warranties. Covenant of seisin. Covenant against encumbrances. Covenant of quite enjoyment. Covenant of further assurance. Covenant of warranty forever. General warranty deed. Special warranty deed. Bargain and sale deed. Quitclaim deed. Deed in trust. Trustee’s deed. Reconveyance deed. Deed executed pursuant to a court order. Transfer tax. Documentary stamps. Involuntary alienation. Adverse possession. Will. Testate & in-testate. Statue of descent and distribution. Devise & devisee. Codicil. Holographic & nuncupative will. Heirs. Probate. Executor & administrator.

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Types of Value

Market value. Investment value. Value in use. Insurable value. Assessed value. Going concern value. Liquidation value. Price vs. value.

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Appraisal Principals: Other (not otherwise listed)

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