Real Estate Appraisal Guide
I lately did a commercial genuine estate appraisal in Orlando on a piece of property owned by a good lady who regrettably had just lost her husband. Her adult son flew in from out of town to assist her settle the estate. The son required a commercial genuine estate appraiser, and he hired me for the job.
He was confident that the property was worth about $750,000, based on a specific well-liked free of charge on the internet site service that you have most likely heard of (hint: it rhymes with willow and begins having a Z!) This free of charge service is infamous for becoming a so-called dependable source for estimating what I call “quick and dirty” actual estate values.
When I met with him, he had the documentation for his web-derived predetermined value in hand, and he was overly confident that I could be onboard. I went back to my office and quickly ran out the legal description for the property on my Deed Plotter software program.
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It turned out that the property had substantially much less land region than this totally free estimating service stated the property had. Immediately after even further investigation, it turned out that the free of charge on the internet estimating service employed the very same unit value and land region located within the county property appraiser’s records.
I did my sales search and located 3 comparable sales inside two miles of the topic property, which had closed inside the past couple of months. These sales reflected a reasonably tight range, and towards the disappointment of the owner and her son, the value was about 35% below the $750,000 value they hoped it could be.
Reality Check Number 1 – The assessed value estimated by the county property appraiser is often a truly poor indicator of marketplace value
and
Reality Check Number 2 – the estimated value estimated by free of charge on-line valuation services may also be a actually poor indicator of marketplace value
I’ve never ever employed this no cost on the web value estimating service, since rather frankly, I cannot envision that significantly investigation goes into these value estimates. Nevertheless, I do check the assessments estimated by the county property appraiser on just about every 1 of my commercial appraisals, and quite rarely do I discover that their assessments are in-line using the marketplace values.
The valuation for a specific property is often individualized, and is normally derived from sales or rental information in an ever-changing industry.
For this reason alone, estimating market place value must be left towards the commercial appraisers who think about all the detailed analysis necessary in every appraisal assignment.
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