Real estate appraisal is that the real one?
Real estate appraisal or property valuation is the process of determining the value of the property on the basis of the highest and the best use of real property (which basically translates into determining the fair market value of the property).
The person who performs this real estate appraisal exercise is called the real estate appraiser or property valuation surveyor. The value as determined by real estate appraisal is the fair market value. The real estate appraisal is done using various methods and the real estate appraisal values the property as different for difference purposes e.g. the real estate appraisal might assign 2 different values to the same property (Improved value and vacant value) and again the same/similar property might be assigned different values in a residential zone and a commercial zone.
However, the value assigned as a result of real estate appraisal might not be the value that a real estate investor would consider when evaluating the property for investment. In fact, a real estate investor might completely ignore the value that comes out of real estate appraisal process. A good real estate investor would evaluate the property on the basis of the developments going on in the region. So real estate appraisal as done by a real estate investor would come up with the value that the real estate investor can get out of the property by buying it at a low price and selling it at a much higher price (as in the present).
Similarly, real estate investor could do his own real estate appraisal for the expected value of the property in, say 2 years time or in 5 years time. Again, a real estate investor might conduct his real estate appraisal based on what value he/she can create by investing some amount of money in the property i.e. a real estate investor might decide on buying a dirty/scary kind of property (which no one likes) and get some minor repairs, painting etc done in order to increase the value of the property (the value that the real estate investor would get by selling it in the market).
So, here the meaning of real estate appraisal changes completely (and can be very different from the value that real estate appraiser would come out with if the real estate appraiser conducted a real estate appraisal exercise on the property). A real estate investor will generally base his investment decision on this real estate appraisal that he does by himself (or gets done through someone). So, can we then term real estate appraisal as a really real real estate appraisal?
The writer is the founder of www.EastLiving.com.sg . Having accumulated a wealth of experience in dealing with thousands of private home buyers and sellers, Stuart Chng and his team, has honed their real estate negotiation skills and a thorough understanding of the needs and psychology of home buyers. Sign up for EastLiving's daily Singapore Property News at http://blog.eastliving.com.sg .
Related Articles:
Plaza Las Americas Shopping Center Under Construction On Eastern Avenue in Las Vegas
Gatski Commercial Real Estate Services is now pre-leasing space in a new shopping center under construction in urban Las Vegas that will serve the area along with the burgeoning Hispanic population. Gatski Commercial and the shopping center's developer, RCS Development, are working to attract a grocery store or Hispanic market along with a restaurant/bar with gaming, plus other neighborhood service users such as an insurance company, a real estate company, a sandwich shop, pizza restaurant, coffee shop and medical or dental user. For more information on Plaza Las Americas, interested parties should contact Gatski Commercial at (702) 221-8226 or visit www.lvshoppingcenter.com
Real Estate Investor Training-Choosing a Coach and Mentor
Have you noticed that the sports teams and individuals that have the best winning records are the ones with the best coaches? If a professional team does not have a winning record who do they replace first? Of course it's the Coach! Real estate investing is a business where just one mistake can cost you many thousands of dollars and for that reason alone the most important member of your investment team is your coach and mentor.
Green Key Real Estate Founder Elected to Build It Green Board of Directors
Broker Chris Bartle helps organization accelerate the adoption of green building practices, policies and programs across California.
Coming to Las Vegas – the Las Vegas Real Estate Boom
Nobody seems to be 'Leaving Las Vegas' anymore – in fact just the opposite is true. Just as in the time of the rush Las Vegas real estate has been drawing the attention of investors and new citizens alike.
A Few Golf Tips From Tiger Woods
Tiger Woods is the undisputed king of professional golf. With a smooth technique you could set your watch by, he makes winning those championships look like a walk in the park.
National Real Estate Publication Honors Tampa's Robert Lipply as Broker/Agent of the Month
Broker Agent Magazine has selected the Lipply Real Estate Group for special recognition in the Tampa Bay area as an industry leader in 2007. Robert Lipply leads the team that ranked 13th for year ending sales in the Pinellas Realtor Organization.
New Real Estate Firm Is Formed to Assist Land Owners and Corporations
Property Development Experts Launch Steelwood, a Charlotte, NC Real Estate Brokerage and Consulting Firm
Workers in Florida's Key Occupations Priced Out of Housing Market, According to eFinanceDirectory.com Analysis
Florida home prices increased an average of 84 percent during the boom, but wages did not keep pace. As a result, Florida workers in key occupations can no longer afford to buy into the housing market.
Legendary Home Shopping Host Bob Circosta Takes a Swing at the GOLF CHANNEL
America's original shopping host to appear on reality TV show "Fore Inventors Only."
Real Estate Recovery
The Wall Street Journal came out with an article talking about how the real estate market reached a bottom in April They talked about how the depressed market is on it?s road to recovery and that the signs are all there to back it up