Real Estate Appraisal Glossary

A professional opinion of value for a specific property as of a specific date, prepared by a qualified appraiser following established standards and methodologies.

A licensed professional who provides unbiased property valuations. Appraisers must meet education, experience, and examination requirements to obtain state certification.

The value assigned to a property by a tax assessor for property tax purposes. This value may differ from market value and is used to calculate property taxes.

Recently sold properties that are similar to the subject property in location, size, age, condition, and features. Used in the sales comparison approach to estimate value.

One of the three main valuation approaches that estimates value by calculating the cost to replace the property, minus depreciation, plus land value.

The loss in value of a property due to physical deterioration, functional obsolescence, or economic obsolescence. Used in the cost approach to adjust replacement cost.

The age of a property based on its condition and utility, rather than its chronological age. A well-maintained older property may have a lower effective age.

The price at which a property would sell in a competitive market, assuming both buyer and seller are knowledgeable, willing, and not under pressure to act.

The total area of finished, above-grade living space in a residential property, measured from the exterior walls. Excludes basements, garages, and unfinished areas.

The most probable use of a property that is legally permissible, physically possible, financially feasible, and maximally productive.

A valuation method that estimates value based on the property's income potential. Used primarily for income-producing properties like rental homes or commercial buildings.

The most probable price a property would sell for in a competitive market, assuming normal marketing time and typical market conditions.

Loss in value due to factors that make a property less desirable or useful. Includes physical deterioration, functional obsolescence, and economic obsolescence.

The physical examination of a property by an appraiser to assess its condition, features, and characteristics for valuation purposes.

The process of analyzing and weighing the results from different valuation approaches to arrive at a final value conclusion.

A valuation method that estimates value by comparing the subject property to similar properties that have recently sold, making adjustments for differences.

The property being appraised. The appraiser analyzes this property's characteristics and compares it to similar properties to determine its value.

Uniform Standards of Professional Appraisal Practice - the national standards for real estate appraisals in the United States, established by the Appraisal Foundation.

The final estimated value of the subject property, derived from the appraiser's analysis and reconciliation of different valuation approaches.

Local government regulations that control how land can be used, including permitted uses, building requirements, and density restrictions that affect property value.