Basic Appraisal Procedures

Transcription

1 Hondros Learning Basic Appraisal Procedures Timed Outline Topic Area Reference(s) Learning Objectives The student will be able to identify and/or apply: Teaching Method Time Segment (Minutes) Day 1 Chapter 1: Appraisal Development and Reporting The Appraisal Process Pg. 2 PPT Appraisal Development Pgs Appraisal Development Step 1 Identify the -the elements of problem identification Problem - how problem identification leads to the scope of Work Problem 1.1: Fill in the Blank work decision Work Problem 1.2: On the Street - the importance of determining the intended Work Problem 1.3: Test Your Knowledge use and intended users Work Problem 1.4: On the Street Appraisal Development Step 2 Scope of Work Decision - how other assignment conditions affect the scope of work -how scope of work is defined and its Appraisal Development Step 3 Applicable Data Collection and Analysis importance going forward in the assignment through overview, the definition of each Appraisal Development Step 4 Application of the Approaches to Value valuation approach - how the scope of work will determine the Appraisal Development Step 5 Reconciliation and Final Opinion of Value Fill in the Blank 1.5 Appraisal Reporting applicability of each approach - the rationale of choosing the appropriate method results to weight, in the context of the scope of work Pgs applicability and decisions in reconciliation Reporting Step 6 - Report of Defined Value PPT the two reporting options permitted by True or False 1.6 USPAP and how the choice is determined by the Pgs intended use and user PPT Pgs PPT Chapter 2: Property Analysis and Description Land Legal Descriptions for Land Pgs elements of data for describing the subject site

2 PPT how data is employed to illustrate the Government Survey System property description Lot and Block System - that neighborhoods are defined by similar Metes and Bounds System physical and market commonalities Pgs how to describe the neighborhood boundaries General Property Description PPT how the forces of value affect land/site Basic Subject Information - how site size/area is determined Analyzing and Describing the Neighborhood and Market Geographic and Geologic Land Characteristics Pgs PPT Geographic Characteristics of Land & Site Geologic Characteristics of the Land/Site Final Elements of Land and Site Description - how location affects progression and regression of the improved property Pgs Chapter 2 Math Practice - that shape and frontage can be key for PPT different land/site uses Lot and Land Measurements - typical private and public restrictions and Work Problems covenants Calculating Sections - the stages of a neighborhood life cycle Work Problems the effects of zoning on site/land Pgs PPT Pg PPT DAY 1 TOTAL Chapter 3: Property Analysis and Description - Improvements Pgs Basic Residential Construction - the phases in the progression of the PPT construction process Residential Construction Process - what the various steps are within each phase Build Your Knowledge 3.1 of the process Work Problems 3.2: Customer Satisfaction -what building codes are and how they apply Building Codes, Permits, and Inspections to different types of structures and uses Build Your Knowledge how a building inspection differs from a Work Problems 3.4: Construction Inspection home inspection - the process and timing of the building inspection process Styles, Parts, and Systems of Houses - the recognition of substandard conditions in construction Pgs the various types of houses, their Property Inspection recognizable characteristics, and how the PPT Professional Home Inspections appraiser will reference them in the appraisal Areas Covered By a Professional Home report Inspection - the definition of manufactured housing (per

3 Pgs Fannie Mae) and how this construction differs Describing Improvements PPT from other types of construction and impacts Calculating Gross Living Area the scope of work Pgs recognition of the various construction Highest and Best Use components of a house PPT Analyzing Highest and Best Use - the definition of a mechanical system and the Examples of Highest and Best Use Conclusions common items found in each Other Considerations of Highest and Best Use - accepted methods of mathematically Pgs calculating gross living area Math Exercises PPT the process and application of highest and best use Gross Living Area (GLA) Calculations Work Problems 3.5 Cubic Foot Calculations Work Problems Work Problem 3.7 Pgs PPT Pgs PPT Chapter 4: Overview of the Sales Comparison Approach Data Collection Pgs PPT Comparable Properties Competitive Properties Properties that are Comparable and Competitive - underlying theories that influence the sales comparison approach - how comparable data is chosen - guidelines which are observed - the process of deriving adjustments from the market - the process of applying adjustments Choice of Data Data Analysis Pgs PPT Units of Comparison Elements of Comparison - net and gross adjustments Identifying and Supporting Adjustments the proper application of percentage adjustments Applying Adjustments - the sequence of adjustments and how this Reconciliation order affects percentage adjustments Work Problem 4.1: Statistical Measures - how the comparable data is reconciled and a Case Study - Applying Adjustments value range developed Pg PPT Pg PPT DAY 2 TOTAL

4 Chapter 5: Overview of the Income Approach Income Concepts and Components Pgs PPT Income vs. Rent Measures of Income and Benefits Operating Expenses - the application of the income approach to Rent and Income Factors residential properties - the differences between the GRM and the Rates of Return GIM and how they are derived and applied Pgs Income Analysis - the application of the direct capitalization PPT method using an overall rate Multipliers - what defines net income and the various considerations Work Problems how overall capitalization rates are derived - income formulas for direct capitalization Direct Capitalization Using an Overall Rate (IRV) Work Problems 5.2 Pg. 142 PPT QUIZ Pg PPT Chapter 6: Overview of the Cost Approach & Final Reconciliation Concepts and Development of the Cost Pgs Approach PPT Costing Concepts Development of the Cost Approach Work Problem distinctions of replacement cost versus Work Problem 6.2 reproduction cost - various methods of establishing cost new Concepts of Depreciation scenarios of applicability of the depreciation Estimating Depreciation methods Work Problem the estimation of economic life and effective age Work Problem causes of depreciation Work Problem methods for derivation of depreciation Estimating Other Site Improvements recognition of various types of obsolescence Final Cost Approach Analysis - an overview of the application of the cost Pgs Final Reconciliation of Value approach within the appraisal assignment PPT the reconciliation process and the logic and rationale used in reconciling the approaches developed and the final opinion of value Process of Reconciliation Final Reconciliation Examples Statistical Measures and Rounding in Reconciliation Pgs PPT Pg

5 PPT Chapter 7: Overview of Land and Site Valuation Pgs Valuation Methodology for Land and Site PPT the methodology and rationale for applying the Sales Comparison Method various techniques for land and site valuation Allocation Method - the process of developing the sales comparison Work Problem 7.1 method in site valuation Extraction Method - the process of developing the allocation method in Work Problem 7.2 site valuation - the process of developing the extraction method in Land Residual Method site valuation Work Problem the process of developing the land residual Ground Rent Capitalization Method method in site valuation Work Problem the process of developing the ground rent Subdivision Analysis Method capitalization method in site valuation Pgs Other Important Site Valuation Concepts - the process of developing the subdivision analysis PPT method in site valuation Assemblage - concepts of assemblage and resulting plottage Surplus and Excess Site - distinction of surplus site and excess site how Pg. 175 each is treated in the site valuation process PPT Pg PPT DAY 3 TOTAL Chapter 8: Real World Residential Appraisal Applications Appraising for Mortgage Lending Transactions Performing Appraisals for the Secondary Market Mortgage Industry Reporting Forms Appraising for Other Purposes Pgs PPT Pgs PPT the theoretic difference between market price and market value - through practical application, how sale conditions affect market value -an example of market testing through exposure of the property to the open market, and how value limits are indicated through that Relocation Insurance exposure, and appraiser commentary of the Appraisal Review sale terms Pgs how untypical sale conditions affect the use Residential Application Case Studies PPT of the transaction data for future comparable Application of Market Value use Case Example 8.1: Property Sells for More than - how exposure and seller knowledge can affect the transaction and appraiser the Asking Price Case Example 8.2: commentary Property Priced and Being Sold Below Market - an example of converting the concession to a Value dollar amount Case Example 8.2: continued - various zoning concerns and how to

6 Application of an Arm s Length Transaction Case Example 8.3: Property Sells for Less than Market Value Application of Zoning Issues Case Example 4.4: Three-Unit Apartment Building with Small Site Area Final Thoughts on Residential Applications and Issues Mixed Use and Non-residential Appraisal Pgs PPT recognize them - how value is affected by zoning - hypothetical conditions in the appraisal report - regulations and laws such as ADA and how they affect the highest and best use typical land valuation methods for nonresidential and income producing land - how fundamental are employed using different techniques - how trade fixtures and natural attachments are handled in the appraisal process - value definitions and applications most commonly associated with non-residential assignments - the definition and elements of a narrative appraisal report - how the highest and best decision is What is Different? Appraising Large Tracts of Land Methods for Appraising Large Tracts of Land Non-Residential Improvement Description and Analysis Trade Fixtures complicated by broad zoning allowances Reporting Methods to recognize the differences in market rent Pgs Non Residential Application Case Studies and contract rent in lease analysis PPT through practical application the valuation Case Study 8.5: Mixed-use Property process of a mixed-use property Case Study 8.6: Zoning Issues - how to consider alternative uses Case Study 8.7: Income-Producing Properties and Lease Analysis Pgs PPT Pgs Chapter 9: Overview of Reporting Forms Pgs Residential Appraisal Report Forms PPT The Uniform Residential Appraisal Report - the appropriate application for various reporting forms common to the mortgage lending industry requirements for compliant reporting using each Uniform Appraisal Dataset industry form - the application of the Uniform Appraisal Dataset Other Appraisal Forms and Reports (UAD) and its purpose Pgs Reporting Forms for Other Purposes - prohibitions and requirements for appraisals using PPT mortgage industry forms. One-Unit Residential Appraisal Field Review - basic required exhibits and attachments when Report Form using mortgage industry forms. Appraisal Update and/or Completion Report Pg PPT

7 Pg. 228 PPT Final Exam 30 Day 4 Total Course Total 30 Hours