An appraisal is a written report indicating an estimate or opinion of value of a specific property as of a specific date, supported by an analysis of comparable relevant data, prepared for an identified party. A fee is collected; the appraiser accepts responsibility for his/her research and must comply with the standards of professional practice.
An appraiser is required to provide a completely objective opinion of value, independent of any other business interests. A qualified appraiser has been awarded an AACI or CRA designation from the Appraisal Institute of Canada and has had years of education and field work. It is his/her job to keep up to date with changes in market trends and laws which affect real estate values, providing you with a thorough report giving you a professional opinion you can trust.
Clients typically look for a professional appraiser for an opinion on:
There are 3 types of reports - a Narrative Report, a Short Narrative Report and a Form Report and all must contain:
There are 3 basic methods used to arrive at an estimate of value.
It is defined as "that use which is most likely to produce the greatest net return over a given period of time". Net return may involve net income, as from an investment property, or satisfaction and amenities, as from a house. The following are considerations used when determining the Highest and Best Use:
When you hire a member of the Appraisal Institute of Canada, you are hiring a professional you can trust, who will work for only one person: you. It is his/her job to determine the market value of any property so that you can get the best value possible.
Ensuring that your house is in good repair and well maintained is a must. However, renovations done on a house with maintenance problems will have a much lower impact on its resale value.
Most renovations will not increase the market value of a house by more than the amount spent.
Poorly done renovations may not have any positive impact or worse, actually may reduce the value of a house.
An appraisal is an opinion of a property's market value while a building inspection is a thorough examination of the physical condition of the structure and its components.
Real Estate Agents typically provide a market analysis and no fee is charged for this service; a commission is paid by the vendor upon sale of property. A professional Appraiser provides an opinion of value of various types of property. There is a fee based on the type of property, complexity and purpose of the appraisal. This fee is not based upon a predetermined value estimate and you will receive an objective, independent value of your property. Ethically, an appraisal assignment cannot be accepted contingent on a pre-determined value.