unit 9 Flashcards
property valuation
process of estimating the value of real property
Land
Ground and what is below and above it. (eg, soil, sand, gravel)
real estate
unimproved RAW land, buildings other fixed improvements to the land
real property
land, any permanent improvements, and property rights go with the land’s ownership.
process of determing assessed property values by collecting relevent sales date over a specific time for the same type of property in a similar area
mass appraisal
comparative market analysis
compares recent sales of similar properties in same area as the subject property.
Usually for residental
income analysis
examines the revenue and expenses associated with the subject property and arrives at a calculation
cost analysis
relies on solid and in-depth knowledge of the cost of construction
retrospective
estimating property value from the past
prospective
forecasting future property values
commodity
raw material or product that is bought and sold
individuals estimate of value a particular item. Personal estimate of. the current/future benefits of the team based on EMOTION
subjective value
objective value
the cost of the land plus the cost of creating any buildings
value in use
an individual may pay more for a property if it has a specific us than a typical buyer would
based on replacement or reporodction costs of all aspects of property that may be damaged/destroyed
insurable value
market price
amount of money paid for a particular property because of a real estate transaction
buyers market
when market supply is strong and buyer demand is weak
seller’s market
demand from buyers is strong and the supply available is low
substitution
buyer will not pay more for a property than the cost
contribution
value of a property (features) make the overall value go up
progression
regression
when properties in the same area have lesser value, they will be increased in value by their close proximity to others with greater value
anticipation
paying more for certain property because it’s worth what they’re looking for and will benefit them in the future.
provides bare. essentials, helps real estate apprasials to quickly complete the report & helps readers of the report to quickly relocate info
form report
a brief statement of a real estate appraisals estimate of value
letter of opinion
the full report, describes the area analysis in detail, identifies & fully describes the subject property, identifies approaches used, and explains the reasoning behind the final estimate
narrative report
Matters of property the crown typically refers to?
Provincial gov
fixed capital
working capital
includes plant, machinery, equipment, factories
inventories of finished and semi-finished goods
principle of increase and decrease
Receive more value to the property when you repair/update something. But if you add something again which is not relevant will not boost value.
direct comparison approach
direct comparison of the subject property to similar properties in the same area that have recently sold
used when estimating the replacement reproduction value of a property.
cost approach
provide an estimate of value for income-producing properties. (Revenue properties)
income approach
two main categories of data used by real estate appraisers
general, specific
area life cycle stages
growth, stability, decline
characteristics of value in relation to commodity
utility, scarcity,marketability
buyers market =
supply is high, buyer demand is weak which decreases prices
sellers market=
supply is low, buyer demand is high which increases prices.
which principle of value allows adjustments to be made to the sale prive of comparable properties?
contributions
which principle of value explains the interaction of buyers and sellers in marketplace?
supply and demand
which principle of value should real estate prof keep in mind when helping owners determine an asking price
substitution
which principle of value is represented by the formula, net income-operational expenses
principle of surplus productivity
what is included when valuing a real estate property
fixed approvement, property rights, surface resources
