Real Estate Appraisal Skills

Lesson 1: Real Estate Appraisal and You. Introduction to real estate appraisal; the nature of real property; concepts for determining property value; standards of appraisal practice; licensing and certification; careers in real estate appraisal.

Lesson 2: Legal Considerations In Appraisal. Real estate defined; real property and personal property; appurtenant rights; the law of fixtures; fee ownership; legal restrictions: police, eminent domain and taxation; private restrictions; common legal descriptions in appraisals.

Lesson 3: The Formal Appraisal Process. Defining the appraisal problem; definition of value; formulating a plan; the extent of data collection; property identification; property rights; limiting conditions; collecting and analyzing data; approaches to valuation; how to determine a property’s market value; types of value reports.

Lesson 4: Neighborhood, Community and Market. The economics of communities; the concept of community; the four common patterns of community and land use; origins of communities; how communities grow, physically and economically; neighborhood boundaries defined; how to get and use information about communities; real estate markets defined; market analysis; how to interpret neighborhood and community price levels, price movements and activity levels.

Lesson 5: Real Estate Economics and Value. Understanding the real estate economy; physical, social, economic and political forces affecting value; the four elements of value: utility, scarcity, demand and transferability; supply; demand; marketability and productivity of real estate.

Lesson 6: Property Inspection and Analysis: The Site. Conducting an on-site inspection: the principle of highest and best use; key features; legal liabilities; physical problems to be aware of; data and tools needed for property inspections; the appraisal checklist; the highest and best use analysis; physical characteristics to assess, including lot and shape, building size; topography, soil, drainage, ownership, lot type and improvements; computing property area and volume.

Lesson 7: Property Inspection and Analysis: Improvements. Understanding property improvements such as out buildings, swimming pools, patios, tennis courts and sheds; features emphasizing value: construction classification and quality, building size, equipment and site improvements; inspecting a building; describing and rating a property for marketability; understanding construction, its four classes and its characteristics; residential specifications; architectural styles.

Lesson 8: The Sales Comparison Approach. How to produce sales comparables; researching and analyzing sales; making adjustments; calculating value estimates; obtaining suitable comparables; information gathering; calculating statistics; obtaining data; using multiple listing services.

Lesson 9: Analyzing and Adjusting Comparable Sales. Elements to analyze in selecting comparable property sales: terms, time of year, location and physical characteristics; rules for making adjustments and allowances; percentage adjustments; lump sum adjustments; how to apply units of comparison; methods and calculations for establishing comparables; arriving at a conclusion.

Lesson 10: Valuing the Site. Uses of site values; sales and purchases; public auctions; taxes; land developments; methods for land appraisal: market, allocation, development and land residual; four site characteristics: legal, physical, location, plottage; topography.

Lesson 11: The Cost Approach. Estimating land value, cost and the amount of accrued depreciation; arriving at a value; deductions for improvements; cost estimating methods; reproduction cost, the unit-in-place method, direct and indirect costs; index and quantity survey; site location; design features.

Lesson 12: Accrues Depreciation and Estimating Loss in Value. Depreciation cost, market loss and diminished utility defined; the most common factors affecting accrued depreciation: age-life, sales data, observed condition and capitalized income; physical deterioration; understanding functional and economical obsolescence.

Lesson 13: The Income Approach. The principle of anticipation; tangible and intangible benefits explained; the income approach step by step: annual gross income, vacancy and collection losses, gross income and net income; capitalization rate and methods; net operating income; figuring gross rent multipliers; three categories of expenses; types of rent.

Lesson 14: Income Capitalization: Rates and Techniques. Income capitalization defined; converting net income into capital value; criteria for investing in real estate: safety, liquidity, yield and sound management; tax burdens; understanding tax shelters; the size of the real estate investment and how it affects quality; how to buy real property with leverage; how to anticipate current and future returns on a real estate investment; understanding discounted cash flow.

Lesson 15: Reconciling Value Estimates and Reporting Appraisal Opinions. Reconciliation defined; reviewing data; making the final determination; the 12 elements of a residential appraisal report; types of reports: (letter, short form or URAR, and narrative); federal appraisals.

Lesson 16: Appraising Special Ownerships and Interests. Types of residences: single-family, multi-family, condominiums, row houses, town houses, planned unit developments (PUDs), patio homes, cooperatives and mobile homes.