Appraisal Terminology

Did one of us use a term you’re unfamiliar with?  Feel free to call us if you have any questions, we are happy to help.  Here are some examples of common terms used in appraisals.

1) Market Value:

The estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently, and without compulsion.

2) Replacement Cost New:

The amount it would cost to replace an asset at current prices.

3) Highest & Best Use:

The reasonably probable and legal use of property, that is physically possible, appropriately supported , and financially feasible, and that results in the highest value.

4) Fee Simple:

Absolute title to land, free of any other claims against the title, which one can sell or pass to another by will or inheritance.

5) Going Concern:

A business that is currently operating, and which shows that it intends to keep operating. That is, the business is not being run as if it were going to close soon.

 

6) Rights of Way & Easements:

A right-of-way is a type of easement that gives someone the right to travel across property owned by another person.

An easement is the right to use another person’s land for a stated purpose. It can involve a general or specific portion of the property.

 


 

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