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Frequently Asked Questions

Do you have any questions about real estate appraisals? Read through our most commonly asked questions and answers below.

What is a real estate appraisal?

A real estate appraisal is a formal opinion of value expressed either written or orally that is prepared as a result of a retainer or agreement, is intended to be relied upon by identified parties, and for which the Member assumes responsibility.

What are the different types of real estate appraisal reports?

• Narrative: Comprehensive and detailed
• Short Narrative: Concise and briefly descriptive
• Form: A standardized format combining check-off boxes and narrative comments

What is real estate?

Real Estate is land, buildings, and other affixed improvements as a tangible entity. The term pertains to the physical land and appurtenance affixed to the land. Real Estate is immobile and tangible. The legal definition of real estate includes the following tangible components:

• Land
• All things that are a natural part of land, such as trees and minerals
• All things that are attached to land by people, such as buildings and site improvements.

In addition, all permanent buildings attachments such as plumbing, electrical wiring, and heating systems as well as built-in items such as cabinets and elevators are usually considered part of the real estate. Real Estate includes all attachments above and below the ground.

What are the different types of value opinions?

First, it is important to understand that all real estate appraisal reports have an Effective Date that the report conclusions are based on. An Effective Date refers to “The date at which the analyses, opinions and conclusions in an Assignment apply. The Effective Date may be different from the inspection date and/or the report date.

The different types of value opinions are as follows:

• Current Value Opinion: An effective date contemporaneous with the date of the Report, at the time of inspection, or at some other date within a reasonable short period from the date of inspection, when market conditions have not or are not expected to have, changed.
• Retrospective Value Opinion: An Effective Date prior to the date of the Report.
• Prospective Value Opinion: A forecasted value opinion and refers to an Effective Date beyond the date of the report.

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