AAEC Property Appraisal AAEC 4303 PROPERTY APPRAISAL

AAEC Property Appraisal REAL PROPERTY AND IT’S APPRAISAL LAND => CONCEPTS 1.LEGAL - PROPERTY RIGHTS 2.ECONOMIC - VALUE 3.SOCIAL – LAND OWNERSHIP IS A FUNDAMENTAL AMERICAN PRESUIT

AAEC Property Appraisal LEGAL  LAWS IN THE U.S. THAT GOVERN THE USE OF LAND GIVE THE LANDOWNER THE GREATEST POSSIBLE FREEDOM TO DECIDE LAND USE.  REAL ESTATE APPRAISING INVOLVES THE VALUATION OF REAL PROPERTY RIGHTS.

AAEC Property Appraisal LEGAL MATTERS PERTAINING TO LAND  EASEMENTS  ACCESS REGULATIONS  USE RESTRICTIONS (ZONING)  RECORDING OF TITLE  CONVEYANCE OF TITLE

AAEC Property Appraisal ECONOMIC  CENTRAL TO APPRAISAL THEORY IS THE CONCEPT THAT LAND IS A SOURCE OF WEALTH AND AN OBJECT OF VALUE.  LAND IS: –UNIQUE IN LOCATION AND COMPOSITION –PHYSICALLY IMMOBILE –DURABLE –SUPPLY IS FINITE –HAS USE

AAEC Property Appraisal SOCIAL  LAND OWNERSHIP IS A FUNDAMENTAL AMERICAN PURSUIT.

AAEC Property Appraisal REAL ESTATE VS. REAL PROPERTY  REAL ESTATE – THE PHYSICAL LAND AND APPURTENANCES AFFIXED TO THE LAND. THE PHYSICAL LAND AND APPURTENANCES AFFIXED TO THE LAND.  REAL PROPERTY - ALL INTEREST, BENEFITS, AND RIGHTS INHERENT IN THE OWNERSHIP OF REAL ESTATE. ALL INTEREST, BENEFITS, AND RIGHTS INHERENT IN THE OWNERSHIP OF REAL ESTATE.

AAEC Property Appraisal PROPERTY RIGHTS “BUNDLE OF RIGHTS” 1. USE 2. SELL 3. LEASE 4. ENTER INTO 5. GIVE AWAY 6. DO NOTHING

AAEC Property Appraisal IF YOU HAVE ALL OF THE PROPERTY RIGHTS, YOU HAVE FEE SIMPLE TITLE ABSOLUTE OWNERSHIP, UNENCUMBERED BY ANY OTHER INTEREST

AAEC Property Appraisal OTHER TYPES OF OWNERSHIP INTEREST  LEASE FEE ESTATE –OWNERSHIP INTEREST HELD BY THE LANDLORD WITH THE REGHT OF USE CONVEYED TO OTHERS.  LEASEHOLD ESTATE –RIGHTS OF USE HELD BY THE LESSEE

AAEC Property Appraisal  INDIVIDUAL RIGHTS IN PROPERTY CAN BE SOLD, LEASED, TRANSFERRED, OR OTHER WISE DISPOSED OF SEPARATELY.  AN EXAMPLE WOULD BE MINERAL RIGHTS

AAEC Property Appraisal REAL ESTATE VS. PERSONAL PROPERTY  PERSONAL PROPERTY – INCLUDES MOVABLE ITEMS OF PROPERTY THAT ARE NOT PERMANENTLY AFFIXED TO REAL ESTATE. PERSONAL PROPERTY IS NOT ENDOWED WITH THE RIGHTS OF REAL PROPERTY OWNERSHIP

AAEC Property Appraisal  PROPERTY RIGHTS ARE EXCLUSIVE, BUT NOT ABSOLUTE. –WHEN PROPERTY RIGHTS ARE HELD BY INDIVIDUALS, THEY CAN EXCLUDE ALL OTHERS FROM ACCESS TO OR USE OF THE PROPERTY. –HOWEVER, THE EXCLUSIVE RIGHTS HELD BY INDIVIDUALS ARE ALWAYS SUBJECT TO THE CONTROLS AND LIMITATIONS VESTED IN THE SOVEREIGN POWER.

AAEC Property Appraisal GOVERNMENTAL POWERS  TAXATION: THE RIGHT OF GOVERNMENT TO RAISE REVENUE THROUGH ASSESSMENTS OF GOODS, PRODUCTS AND RIGHTS.  EMINENT DOMAIN: THE RIGHT OF GOVERNMENT TO TAKE PRIVATE PROPERTY FOR PUBLIC USE UPON THE PAYMENT OF A JUST COMPENSATION.

AAEC Property Appraisal  POLICE POWER: THE RIGHT OF GOVERNMENT UNDER WHICH PROPERTY IS REGULATED TO PROTECT PUBLIC SAFETY, HEALTH, MORALS, AND THE GENERAL WELFARE.  ESCHEAT: THE RIGHT OF GOVERNMENT THAT GIVES THE STATE OWNERSHIP OF A PROPERTY WHEN IT'S OWNER DIES WITHOUT A WILL OR ANY ASCERTAINABLE HEIRS.

AAEC Property Appraisal PRIVATE LIMITATIONS  RESTRICTIVE COVENANTS –MAY IMPOSE PRIVATE CONTROLS ON THE USE OF LAND  EASEMENTS –GIVE OTHERS THE RIGHT TO USE THE LAND FOR A SPECIFIC PURPOSE  RESERVATIONS –SUCH AS RETAINING MINERAL RIGHTS OR RIGHTS-OF-WAY

AAEC Property Appraisal APPRAISAL  AN ESTIMATE OR OPINION OF VALUE FOR AN ADEQUATELY DESCRIBED PROPERTY, AS OF A SPECIFIED DATE, SUPPORTED BY THE ANALYSIS OF RELEVANT DATA

AAEC Property Appraisal PURPOSE AND USE OF AN APPRAISAL  THE REASON FOR THE APPRAISAL ASSIGNMENT.  THE PURPOSE IS DETERMINED BY THE CLIENT.  THE USE OF AN APPRAISAL IS THE MANNER IN WHICH THE CLIENT EMPLOYS THE APPRAISAL. 1. TRANSFER OF OWNERSHIP 2. FINANCING 3. DETERMINATION OF COMPENSATION IN CONDEMNATION PROCEEDINGS. 4. TAX ASSESSED VALUE. 5. INVESTMENT DECISION.