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Probable Price/value

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J Grant

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Certified Residential Appraiser
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Florida
The issue comes up when an appraiser says, " but the most probable price IS market value, assuming the property transacted at the terms in the MV definition. Along the lines of the below, from a prior closed thread.

TMD-'My answer is that price equals value when the price is the most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale which is obviously the case when a large percentage of buyers in a particular market are willing to pay that price"

USPAP concept : if an appraiser offers an opinion of value ( such as that the price equals value ), the appraiser communicated an appraisal result ( which requires a work file )

Which is why I differentiate an opinion of value ( an appraisal ) from a price that meets the definition of market value ( the famous MV definition of most probable price.)

The logic goes like this: a sale price is market value because it is the most probable price ,and it is the most probable price since many buyers paid it, as long as it transacted within the terms in the MV definition. Fine, you just communicated an opinion of value, ( an appraisal on that property, need a work file).
 
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D

Deleted member 134708

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Drinking tonight? That's about as incoherent a statement I've read in awhile.

I didn't want to comment 1st because I couldn't understand it nor follow it. Glad I'm not going crazy.

Cheers to all. Hey, not judging. We all have our moments. Not even gonna judge you @J Grant.

Water under the bridge. Cheers. :beer:
 

residentialguy

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Mar 24, 2009
Professional Status
Certified Residential Appraiser
State
Minnesota
Fine, you just communicated an opinion of value, ( an appraisal on that property, need a work file).
Really....says who? And if you say "USPAP", please quote it. Thanks.
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
The eight organizations of the NACAO eventually created The Appraisal Foundation which, by means of its promulgation of the Uniform Standards of Professional Appraisal Practice, now defines an appraisal as: APPRAISAL: (noun) the act or process of developing an opinion of value; an opinion of value. (adjective) of or pertaining to appraising and related functions such as appraisal practice or appraisal services. Comment: An appraisal must be numerically expressed as a specific amount, as a range of numbers, or as a relationship (e.g., not more than, not less than) to a previous value opinion or numerical benchmark (e.g., assessed value, collateral value). (USPAP) (An example of expressing an appraisal as a “relationship” might be if a client simply wanted to know if the market for a previously-appraised property had changed; or whether the value of the property has remained the same, increased or decreased since the prior appraisal. In making a determination one way of the other, the appraiser is performing an app

USPAP opinion of value definition #92 #95, #135
(record keeping rule : workfile, definitions #308,

92-USPAP definition of market value: a type of value stated as an opinion, that presumes the transfer of a property as of a certain date under specific conditions set forth in the definition of the terms identified by the appraiser as applicable in the appraisal.
:X3:
 
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Mr Rex

Elite Member
Joined
Jan 12, 2004
Professional Status
Certified Residential Appraiser
State
North Carolina
Based on a complete visual inspection of the interior and exterior areas of the subject property, defined scope of work, statement of assumptions and limiting conditions, and appraiser’s certification, my (our) opinion of the market value, as defined, of the real property that is the subject of this report is $ , as of , which is the date of inspection and the effective date of this appraisal.

DEFINITION OF MARKET VALUE: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale...

Jgrant has some sort of disconnect between page 2 and 4. Maybe it's ADHD?
 

jay trotta

Elite Member
Joined
Feb 8, 2004
Professional Status
Certified Residential Appraiser
State
Connecticut
Space control to Major Tom,

Tom Waits, an oldie but goodie (Jersey Girl ) and Stevie Ray V (Lennie (sp)) written with the other half in mind and great tunes....cheers
 

J Grant

Elite Member
Joined
Dec 9, 2003
Professional Status
Certified Residential Appraiser
State
Florida
I have no problem with the definition of market value Mr. Rex,,. (nor of how it links to the statement on page 2) for a subject...

What I have a problem with is when I see appraisers say, the price of sale A is the most probable price because a lot of buyers are paying that price for similar homes, and as long as it sold for MV definition terms, that makes the sale price of comp A market value , since it sold at a most probable price.

When an appraiser does that, they are expressing an opinion of value, an opinion of market value ( an appraisal) Have they appraised that comp sale A? No.

APPRAISAL: (noun) the act or process of developing an opinion of value; an opinion of value. (adjective) of or pertaining to appraising and related functions such as appraisal practice or appraisal services. Comment: An appraisal must be numerically expressed as a specific amount, as a range of numbers, or as a relationship (e.g., not more than, not less than) to a previous value opinion or numerical benchmark (e.g., assessed value, collateral value). (USPAP) (An example of expressing an appraisal as a “relationship” might be if a client simply wanted to know if the market for a previously-appraised property had changed; or whether the value of the property has remained the same, increased or decreased since the prior appraisal. In making a determination one way of the other, the appraiser is performing an app
 
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residentialguy

Elite Member
Joined
Mar 24, 2009
Professional Status
Certified Residential Appraiser
State
Minnesota
Based on a complete visual inspection of the interior and exterior areas of the subject property, defined scope of work, statement of assumptions and limiting conditions, and appraiser’s certification, my (our) opinion of the market value, as defined, of the real property that is the subject of this report is $ , as of , which is the date of inspection and the effective date of this appraisal.

DEFINITION OF MARKET VALUE: The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale...

Jgrant has some sort of disconnect between page 2 and 4. Maybe it's ADHD?
I have no problem with the definition of market value Res Guy!. (nor of how it links to the statement on page 2) for a subject...
Ahhh....Space control to Major Tom....that was Mr. Rex. :alcoholic:
 
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