Property Valuation
A Minnesota appraiser determines the highest and best use of a suburban property as retail commercial, even though it is currently used as a single-family home. The appraiser will:
AValue the property only as a residence since that is the current use
BConsider the highest and best use value, even if different from current use✓ Correct
CAutomatically assume the land should be cleared for retail development
DNot proceed without the owner's permission to change use
Explanation
Highest and best use analysis is a fundamental appraisal concept. The appraiser must consider what use would maximize the property's value, which may differ from the current use. If retail use is the highest and best use, the appraiser values the property accordingly, acknowledging it is underutilized in its current use. This often happens with Minnesota properties near growing commercial corridors.
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