- Joined
- May 28, 2002
- Professional Status
- Certified General Appraiser
- State
- Ohio
I think I am having a brain ****!
I have been asked by a client to appraise a single family residence (spec home) that is currently under construction and is about 50% complete. The appraisal is to be done "as is" only. I just want a few other opinions, which is most likely to be the most applicable approach: the Cost Approach or the Sales Comparison Approach? The Sales Comparison Approach would rely on sales of completed residences less a cost to cure. This would require a huge adjustment, with no market support from sales. The Cost Approach assumes that someone would rebuild that structure to its present condition. Is the home worth what it costs to replace it in its present condition? Is it worth less than that or would it be worth more than that? I guess neither of these approaches is very reliable in this case because of the broad assumptions made.
Comments?
I have been asked by a client to appraise a single family residence (spec home) that is currently under construction and is about 50% complete. The appraisal is to be done "as is" only. I just want a few other opinions, which is most likely to be the most applicable approach: the Cost Approach or the Sales Comparison Approach? The Sales Comparison Approach would rely on sales of completed residences less a cost to cure. This would require a huge adjustment, with no market support from sales. The Cost Approach assumes that someone would rebuild that structure to its present condition. Is the home worth what it costs to replace it in its present condition? Is it worth less than that or would it be worth more than that? I guess neither of these approaches is very reliable in this case because of the broad assumptions made.
Comments?