Manvel Texas Real Estate Appraisals

In real estate highest & best use is defined as the usage of a home that results in the most value. For a highest & best use to be reasonable it must be lawfully permissible, physically possible, and adequately supported when all legal and probable substitutions are reviewed.

The two reports are substantially different in depth and level of analysis. A CMA depends heavily on market trends to conclude value. For residential property a real estate appraiser will also rely greatly on comparable houses, but the depth of research and adjustments to each sale are more exacting. An appraiser also reviews acreage prices, construction costs and rentals in the area. CMA reports, carried out by competent Realtors, are frequently great for determining a span or ball park estimate. Appraisals are much more exact and take a great deal more time. Finally, the most notable factor is the professional developing the report. real estate agents are not obligated to have market expertise or understanding of property valuation to write CMAs. Home appraisers on the other hand are governed by ethics guidelines that require them to have market competency or make their client aware of the lack thereof. Similarly, the real estate agent has a stake in the selling of the home whereas the appraiser is restricted by a code of ethics to charge only a flat sum for jobs, regardless of their outcome.

Because a builder, never occupied house has not yet realized any lose in value, it will appraise for higher than an almost exact existing property. While land will not depreciate in price – properties do. This can be easily demonstrated in the life expectancy of many of a property’s materials and systems. As an example, appliances in a new property have their entire effective life intact as does the electrical, cooling system, hot water system, etc. Compare this to a house that is four years old which has 4 years of effective age applied to all its building materials. Lastly, newer properties typically permit for some customizations to the home which means the buyers get exactly what they want when they move-in without needing to carry out alterations.