Appraisals – Getting Started & Next Steps

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Residential and Commercial Appraisal Services In New York

A commercial property appraiser inspects buildings, stores and warehouses in order to determine their value before they are sold, developed or insured. The value of a property is determined by using the gross rent multiplier approach. The gross rent multiplier is multiplied by gross rents of the property and the gross rent multiplier is determined by dividing the selling price of a property by the subject’s property’s gross rents.

In order to get a commercial property appraisal it takes about two weeks depending on a company’s work load and property type. Therefore the main role of an appraiser is to provide objective, unbiased and impartial opinions on the value of a property. Provision of investment or lending of money on the security of real estate is done by an appraiser as an additional role.

Appraisers that deal in commercial and residential properties are examples of the different classification of appraisers based on the area of specialization. Preparing of reports on a property’s value, inspection and photography of a property are some of the roles of real estate appraisers. Based on multiple real estate properties, real estate appraisers work on legal description and data. The cost approach, income approach and sales comparison approach are some of the approaches used for valuation in an appraisal.

Determining how much a property would cost to replace after removing accrued depreciation is what cost approach does. The reduction in actual value of a property over a time period due to reasons such as wear and tear or obsolescence is accrued depreciation. Using of the current design, construction methods and materials in order to rebuild a property with comparable utility is referred to as replacement cost. Special use properties such as commercial and public properties use cost approach as its considered to be reliable. Also when cost approach is used in new building construction its considered to be more reliable as compared to older construction.

The sales comparison approach bases its opinion on what similar properties in the areas have been sold for. In order to sell a property then they are adjusted for time, size, acreage and amenities. The reasonable adjustments for a given market is determined by the presence of an appraiser. High valuing of a property in one area may not be the same in another as different areas value their property differently.

The process in which property generates income for the owner is the income approach. Substantiate, calculate or identify market value of the property is determined by the income generated. Examples of properties that result to income generation are duplexes and apartment buildings. The market value of the property is assessed using the income.

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