Downloadable PDF Brochure from The Appraisal Institute
Some Commonly Asked Questions About
Real Estate Appraisers and Appraisals
Who are real estate appraisers, and what do they do? Here are
What is an appraisal?
An appraisal is a professional appraiser's
opinion of value. The preparation of an appraisal involves research into appropriate market areas; the assembly and analysis
of information pertinent to a property; and the knowledge, experience and professional judgment of the appraiser.
What is the role of the appraiser?
The role of the appraiser is to provide objective, impartial
and unbiased opinions about the value of real property—providing assistance to those who own, manage, sell, invest in
and/or lend money on the security of real estate.
What qualifications must appraisers have?
minimum, all states require appraisers to be state licensed or certified in order to provide appraisals to federally regulated
lenders. However, appraisers who become designated members of the Appraisal Institute have gone beyond these minimum requirements.
They have fulfilled rigorous educational and experience requirements and must adhere to strict standards and a code of professional
ethics. The Appraisal Institute currently confers the MAI membership designation on those who are experienced
in the valuation of commercial, industrial, residential and other types of properties. The SRA professional
membership designation is held by those who are experienced in the analysis and valuation of residential real property.
How do well-credentialed appraisers add value to real estate transactions?
They bring knowledge,
experience, impartiality and trust to the transaction. In so doing, they help their clients make sound decisions with regard
to real property.
What are the components of an appraisal report?
appraisals are reported in writing, although in certain circumstances, an appraiser may provide an oral appraisal. A written
appraisal report generally consists of: a description of the property and its locale; an analysis of the "highest and best
use" of the property; an analysis of sales of comparable properties "as near the subject property as possible"; and information
regarding current real estate activity and/or market area trends.
What are the most important
considerations in the valuation of real property?
The value indicated by recent sales of comparable properties,
the current cost of reproducing or replacing a building, and the value that the property's net earning power will support
are the most important considerations in the valuation of real property.
What is the range
of services appraisers provide?
In addition to residential or commercial appraisals—and depending
upon an appraiser's designation and qualifications—he or she may be able to assist with the following:
|Estate planning and estate settlements
|Tax assessment review and advice
|Advice in eminent domain and condemnation property transactions
|Dispute resolution—including divorce, estate settlements, property
partition suits, foreclosures, and zoning issues
|Expert witness testimony
|Market rent and trend studies
|Cost/benefit or investment analysis, for example, what will be the financial
return on remodeling
|Land utilization studies
|Supply and demand studies
When hiring an appraiser, what types of questions
should I ask?
The following questions would be appropriate:
|Are you licensed or certified in the state in which you live?
|What professional designations do you have and from what groups?
|How long have you been in practice?
|What level of experience do you have in this particular market and with
this type of property?
|Are you familiar with property in this neighborhood?
|What types of clients have you had (homeowners, estates, lenders, relocation
When in need of an appraiser, why should I hire
a member of the Appraisal Institute?
Appraisers who hold Appraisal Institute professional designations
have met stringent educational requirements, have considerable professional experience and adhere to strict standards of professional
practice that exceed those required by state or federal law. Moreover, Appraisal Institute designated members participate
in continuing education programs—including those that emphasize the most-up-to-date valuation techniques—making
them the preferred source for high-quality appraisal services.
How can I find a member of the Appraisal
It's easy to find a member of the Appraisal Institute. Simply go to www.appraisalinstitute.org and look for the "Find an Appraiser" option. You can search for designated members throughout the United States as well as
abroad by name, city, county, state or metropolitan statistical area (MSA). You can also obtain the Appraisal Institute's
Directory of Members on CD-ROM by calling 312-335-4100 or e-mailing email@example.com. The Directory disk is available at no charge.
For more information regarding the Appraisal Institute, its members,
programs and services, call 312-335-4140, via e-mail at firstname.lastname@example.org, or visit our Web site at www.appraisalinstitute.org.
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