Make an Informed Decision
Effective commercial real estate appraisal services mean that you can effectively assess upcoming projects before any major commitment is made. In this manner, you can see the potential benefits along with the drawbacks, so you can make the best-informed decision about whether to proceed, make changes, or drop the project all together.
How Commerical Real Estate Appraisals Work
The appraisal itself uses three different methods to evaluate the value of a property. Each method is based in different factors that constitute the proper assessment of the property itself.
- Market Value: This is determined by recent sales of similar property in the community
- Income Capitalization: This is the net earning power that the property will provide
- Cost: The actual cost with depreciation factored in terms of economic and function characteristics
Depending on the approach that is used, there will be different determinations for the outcome. For example, if you are using a cost approach, that assumes the value of the property is equal to its replacement, minus the depreciation.
The market value approach determines the value by comparing it to similar properties, such as apartment complexes, office space, and the like which exist today. With all things being equal, an investor would pay no more for this property compared to another which is quite similar in size, scale, and amenities. Of course, income capitalization is based on the projected earning benefit that the property can produce minus the expenses, such as with apartment complexes for example.
Finding the Right Result
When all three approaches are used, they provide great insight into the true value of the property when they are combined to draw out a final evaluation. However, no evaluation will ultimately be definitive down to the final penny if only because market value is an estimation while cost is more determinable.
However, the appraiser will consider all three approaches and apply his or her own experience to determine the final value of the commercial property. Each approach will be prioritized and emphasized based on the experience and knowledge of the appraiser. Ultimately, it does come down to the best use of the property itself.
This also must include the motivations of those who will purchase the property. How the property will be used is a strong determining factor to its outcome. These motivations will be pulled together with the rest of the information and create a final price that covers the value of the property. Again, there are other factors and determination that will need to be accounted, but the result will be from the appraiser.
It is true that different appraisers may reach different conclusions, but usually the difference is relatively minor if based on the same information. The variable factors include the motivation of the buyer which the appraiser will have to assess in making his or her determination.
That is why the proper commercial real estate appraisal is needed from the best company for the job. Be sure to hire the most independent, reputable, and reliable company for the appraisal process so that everyone can see the outcome.
Speak to an Expert Appraiser and Get an Accurate Valuation of Your Property
Why Choose Osteen Appraisals?
We have been relied upon for over 3 decades and two generations by our clients for accurate and responsive appraisals.
See why both lenders, businesses and individuals have trusted Osteen Appraisals since 1984.
Billion Dollars Appraised
Treasure Coast Real Estate Appraisals Since 1984
Since 1984 we have been building relationships on professionalism with our clients. Expert valuations at the right time. Residential. Commercial. Ag & Marine.
Over One Billion Residential Valuations
Years of Experience
Over 2 Billion in Commercial Valuations
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Trusted by Clients
Sold my home quickly on Zillow without a realtor. Their appraisal helped me ensure I priced my home for current market levels which was higher than my Zestimate! Money well spent.
I needed a private appraisal for my family’s property. We wanted to make sure that the price was fair, so we decided to use Osteen Appraisals after word of mouth recommendations. Jared was professional and made the process very easy. We also got the report back quickly. I would highly recommend Osteen Appraisal services because of their trustworthy services, friendly and professional staff, and reputation in the community.
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