USPAP Definitions

[J Grant]

Imo the word "most probable" in USPAP led to some misinterpretations, that of appraisers thinking of probable as some kind of guessing game, or prediction, which is ridiculous given the normally slightly retrospective effective date. The market value definition used to read the "most probable highest price" , but that drove value direction in anchor of high, so they removed that, now that it is merely "most probable", some appraisers it seems read that as if they are expected to predict the market.

Imo "most probable", in context of the appraisal means the most likely price the pool of buyers, represented by the identified typically motivated buyer and seller pay ( actually the OMV statement is the neutral (-what the property should bring, inot what the buyer would pay ). In some cases the most probable price for a property , such as a superior one with a great view would be high, in others, the mid price is most probable, and in others, the low price. It would be relative to the demand, qualities of the subject and perhaps market trends. Yet I aslo see appraisers thinking most probable is a rote mid point or average. It can be, not all the time and not for all properties.

 

[J Grant]

Bert wrote_ My comment: So if I create an Excel spreadsheet of past property sales and tax assessor data that supports my concluded opinion of value, then it is credible, even though it may be based on inaccurate tax assessor data? It MAY be that this is the intended meaning of this word. But USPAP should also state that CREDIBLE opinions are not necessarily based on the truth. There is therefore only a shallow meaning to this term, that is fundamental to the shallowness of many value opinions. They only dig so far into reality and then stop, because they are by definition CREDIBLE, they are accepted as TRUE.

Well, you just answered your own question...if you knowingly base your value opinion on results that include inarticulate tax assessor data , then your value opinion can be misleading., even though it can"appear" credible by looking at the spreadsheet.

Which is why appraisal opinions , to be credible,a aka worthy of belief, are based on the analysis of results (such as a spreadsheet and the appraiser's efforts to find the truth, or accuracy in it USPAP references logic and evidence...there should be an attempt to not present misleading evidence and if some of the evidence is unknown ( a segment of the tax data may be inaccurate) then disclose that... is the case, and present logic in narrative statement why in your opinion, despite the fact that a portion of the tax data may be inaccurate, the opinion of value is worthy of belief ( credible...one might expect additional support for the value opinion beyond just the spreadsheet but if it is only the spreadsheet, then narrative about why you concluded what you did from it.

 

[Mike Kennedy]

"most probable" as of the stated Effective Date

 

[J Grant]

A market value opinion is an opinion of value expressed as a most probable price point equivalent ( per the identified market value as defined,)

Some appraises believe it is a literally a price opinion, or a price prediction. The value is just some pesky word in the sentence...

 

[George Hatch]

I'm curious how else we would go about characterizing the income or expenses or costs that are being forecasted into the future if not to use those terms?

 

[TRESinc]

My comment: Fact is by definition something in the past.

it is a fact you will die one day. what part of the past is that from?

 

[J Grant]

I'm curious how else we would go about characterizing the income or expenses or costs that are being forecasted into the future if not to use those terms?

Unless purpose of assignment is to to forecast a future value, appraiser is appraising what buyer pays today for the future benefits (what $ property should bring as of eff date )