Property Valuation
A Mississippi appraiser completes an appraisal and 'reconciles' the three approaches to value. Reconciliation means:
AAveraging the three value indicators
BAnalyzing the reliability and applicability of each approach and weighting them based on the type of property and available data to reach a final value conclusion✓ Correct
CUsing only the highest value indicated
DPresenting all three values without a conclusion
Explanation
Reconciliation is the appraiser's analytical process of evaluating the reliability, adequacy, and relevance of each approach's indicators. The appraiser weights each approach based on property type, data quality, and market behavior to reach a single, well-supported value conclusion.
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Key Terms to Know
Appraisal
A professional estimate of a property's market value prepared by a licensed or certified appraiser.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
Capitalization Rate (Cap Rate)A rate used to estimate the value of income-producing property, calculated as Net Operating Income divided by property value.
Gross Rent Multiplier (GRM)A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
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