Real Estate Appraisal Course Outline

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.

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.

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.

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.

How real estate appraisers can maximize their time.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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.

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

Regulations and laws in the appraisal profession; government restrictions on appraisers; how the profession controls itself; maintaining high standards of practice; the real estate appraiser's code of ethics.

Getting your full state certification for an unrestricted practice; starting your own full-time or part-time appraisal business; how to market your appraisal business; uncovering career opportunities within appraisal firms, lenders, banks, insurance companies, mortgage companies, credit unions, relocation specialists and others.