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Desmond Elder
Mortgage Advisor
CA Bureau of Real Estate #01350508
NMLS# 29360

 

Supervising Broker Pacific Bay Lending
CA Bureau of Real Estate #01874818
NMLS #318011

 

711 Grand Avenue, Suite 265
San Rafael, CA 94901
530.582.4238

 

Desmond@PacBayLend.com

 

tahoe truckee sacramento mortgage loan

 

www.NMLSconsumeraccess.org

 

Desmond Elder
Mortgage Advisor
CA Bureau of Real Estate #01350508
NMLS# 29360

 

Supervising Broker Pacific Bay Lending
CA Bureau of Real Estate #01874818
NMLS #318011

 

711 Grand Avenue, Suite 265
San Rafael, CA 94901
530.582.4238

 

Desmond@PacBayLend.com

 

tahoe truckee sacramento mortgage loan

 

www.NMLSconsumeraccess.org

   

Appraisal Methods

 

An appraisal is an opinion of value or the act or process of estimating value. This opinion or estimate is derived by using three common approaches, all derived from the market.

  1. The cost approach to determining value is to estimate what it would cost to replace or reproduce the improvements as of the date of the appraisal, less the physical deterioration, the functional obsolescence and the economic obsolescence. The remainder is added to the land value.
  2. The comparison approach to determining value makes use of other "benchmark" properties of similar size, quality and location that have been recently sold. A comparison is made to the subject property.
  3. The income approach to determining value is of primary importance in ascertaining the value of income producing properties and has little weight in residential properties. This approach provides an objective estimate of what a prudent investor would pay based upon the net income the property produces.

Then, after thorough analysis of all general and specific data gathered from the market, a final estimate or opinion of value is correlated.

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