Highest and Best Use Flashcards
To get familiarity for Highest and Best Use
What is a complementary use
when something is recommended to build that compliment the other structures in the area
Financial and economics Analysis of the subject property is
when appraisal performs a highest and best use analysis in a market value assignment.
When using the Restricted Use Report option, the rationale supporting the appraiser’s highest and best use conclusions must be
Stated
If the improvement is not highest and best use, conversion is not economically feasible then what should we recommend?
Raze the improvement
Devoted
To give most of your time, energy or attention to somebody or something
What is the primary purpose of the highest and best use analysis
to establish the contributory value of the improvements
Highest and Best Use is most important when
a property is considered to have an interim use
What are the four steps in determining highest and best use?
Legally permitted, physically possible, financially feasible and most profitable.
What can limit the highest and best use?
Existing Long term lease
External Obsolescence and competition could impact which step of highest and best use?
Financial Feasibility
When Interest Rate decrease, home ownership rate will____ and rental rates will____
increase, decrease
IF property is improved, the value for “as vacant” should be _____ minus______ to make the property vacant
land value, demolition
Define “remaining economic life” of an improvement
How much longer an improvement can continue to remain useful and generate more than is paid out in expense
Define “Principle of Consistent Use”
when interim use is determined, land cannot be valued at one use while the improvements are valued at another
If reasonable or probable change is forthcoming, the appraiser can identify a ___________.
interim use
