1. Welcome to AppraisersForum.com, the premiere online community for the discussion of real estate appraisal. Register a free account to be able to post and unlock additional forums and features.

USPAP Difference between assumption and opinion

Discussion in 'Fannie Mae, Freddie Mac, USPAP' started by Tom Hildebrandt, Sep 9, 2009.

Thread Status:
Not open for further replies.
  1. Tom Hildebrandt

    Tom Hildebrandt Member

    0
    Jan 16, 2002
    Professional Status:
    General Public
    State:
    North Carolina
    In the idle moments over the past several years, when I have thought about USPAP, I have wondered about what the real difference is between an opinion and an assumption.

    Since I am living a life away from appraising now and am living on a sail boat, these discussions have been without the benifit of any input from others, so I keep going in circles!

    One chain of thought, is not an an opinion of value just the end result of assumptions about the market?

    Another is that an assumption is just simply an opinion in its own right.

    I never took logic in college, far too difficult a topic for someone who was more interested in playing than studying, so some insight from fellow forumites would be appreciated.

    Regards


    Tom
     
  2. Caligirl

    Caligirl Senior Member

    0
    Jan 27, 2006
    Professional Status:
    Certified General Appraiser
    State:
    California
    I was taught that an opinion is a conclusion based on fact. While an assumption includes unknowns.
     
  3. DWiley

    DWiley Senior Member

    11
    Apr 4, 2007
    Professional Status:
    Certified Residential Appraiser
    State:
    Tennessee
    An opinion is a view or a judgment. The opinions expressed by appraisers are supposed to be based on facts, but in general, opinions may or may not be based on facts. For example, some hold the opinion that certain colors are more pleasing than others. (i.e. my favorite color is...)

    An assumption is something taken to be true. Disclosing an assumption is not expressing an opinion. For example, if one makes an assumption that the zoning for a property will be changed, that does not neceesarily mean that the appraiser's opinion is that the zoning will be changed.
     
  4. Don Clark

    Don Clark Elite Member

    3
    Jan 17, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Virginia
    In appraisal theory, an assumption does not have to have a limiting factor. That would be an extraordinary assumption if it has a limiting factor. Assumption as defined in USPAP in the vdefintions is that whic is taken to be true. An opinion opinion is not defined in USPAP. However, Websters 2nd College Edition states that it is a belief not based on absolute certainty or positive knowledge but what seems to be true, valid, or probable to one's own mind.
     
  5. Tom Hildebrandt

    Tom Hildebrandt Member

    0
    Jan 16, 2002
    Professional Status:
    General Public
    State:
    North Carolina
    Yes, but the reality of appraising is that the value conclusion we reach is not truly based on facts, it is our assumptions (or is it opinion) about what we believe the facts to be. For example, even deciding what are relevant physical property characteristics is a matter of often widely divergent opinion, essentilally our assumptions about how buyers and sellers view those items.
     
  6. Tom Hildebrandt

    Tom Hildebrandt Member

    0
    Jan 16, 2002
    Professional Status:
    General Public
    State:
    North Carolina
    One definition of an opinion is a belief or idea, held to be true, but which can not be proved to be false. That strikes me as very close to the definiton of an assumption just tendered.
     
  7. Francois K. Gregoire

    Francois K. Gregoire Senior Member

    0
    Jan 14, 2002
    Professional Status:
    Certified Residential Appraiser
    State:
    Florida
    Although I don't have any comment on your question, I do want to take this opportunity to say HI. It's good to see you here after all this time.
     
  8. Tom Hildebrandt

    Tom Hildebrandt Member

    0
    Jan 16, 2002
    Professional Status:
    General Public
    State:
    North Carolina
    Hi Frank

    Gosh, this is like a high school reunion! I take it your are no longer a serving board member in Florida, What else is new in your world?

    Tom
     
  9. Denis DeSaix

    Denis DeSaix Elite Member

    55
    May 16, 2005
    Professional Status:
    Certified General Appraiser
    State:
    California
    Speaking philosophically, there might not be much of a difference.
    Speaking USPAP, there is a specific process which needs to be followed in order to form an appraisal opinion.
    The process of assuming something is not the same as the process for forming an appraisal opinion. :)
     
  10. Workbox

    Workbox Elite Member

    1
    Mar 2, 2005
    Professional Status:
    Certified Residential Appraiser
    State:
    Colorado
    We can only assume that our opinions are right. They can change from day to day. I think that one word (opinion) weakens our profession.
     
Thread Status:
Not open for further replies.

Share This Page