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Actual cash value is an insurance term defined as either fair market value or replacement cost (new) less depreciation (depending on your jurisdiction). Depreciation, in this instance, typically refers to an incremental reduction in value based on age/life formulas commonly in use within the insurance and household goods moving industries. ACV is usually calculated by the adjuster based on these depreciation standards and guidelines. Top Ad valorem is a Latin term meaning "according to value.” In common usage, an ad valorem tax is a tax levied on property in proportion to the value of the property such as a state’s business personal property tax. Top Administrator or administratrix (of an decedent's estate) is one who is appointed by the court if the decedent had no will, if no executor is named in the will, or if the named executor cannot or will not serve. (See personal representative). Top Appraisal (synonymous with valuation) (synonymous with valuation) The Uniform Standard of Professional Appraisal Practice (USPAP) defines an appraisal as (noun) the act or process of developing an opinion of value; an opinion of value. (adjective) of or pertaining to appraising and related functions, such as appraisal practice or appraisal services." An appraisal must be numerically expressed as (1) a specific amount, (2) as a range of numbers, or (3) as a relationship (e.g., not more than, not less than) to a previous value opinion or numerical benchmark such as, for real property, assessed value or collateral value. Appraisal consulting is defined by USPAP as the act or process of developing an analysis, recommendation, or opinion to solve a problem, where an opinion of value is a component of the analysis leading to the assignment results. A consulting assignment involves an opinion of value but does not have an appraisal or an appraisal review as its primary purpose. Note that when used by USPAP, "consulting" applies strictly to the real estate appraiser and not to the personal property appraiser. Top Appraisal Management Company (AMC) offers appraisal services to the public by making use of professional appraisers acting as independent contractors; a fee-sharing arrangement compensates both the AMC for their marketing efforts and the appraisers for their expertise. Top Appraisal practice is a valuation service provided only by appraisers including, but not limited to appraisal, appraisal review, and appraisal consulting. On the other hand "valuation services" are provided by a variety of professionals who are not necessarily "appraisers." (See appraiser and valuation services) Top Appraisal report (see report) Top Appraisal review is defined by USPAP as the act or process of critically studying a report prepared by another appraiser and of communicating an opinion about the quality of the other appraiser's work. The review may be of all or part of an appraisal report, a workfile, or a combination of both. Top Appraise is to set a value on personal, real, or business property. Top Appraiser is one who is expected to perform valuation services competently and in a manner that is independent, impartial and objective. Top Appraiser's peers are other appraisers who have competency and experience in the same or a similar type of assignments as the one under consideration. Top Appreciable personal property is property that increases in value or price over time. Top Appearance allowance is a settlement amount offered when the transit-related damage is not very severe and does not detract from the utility of the object or significantly from its appearance. Usually, repair attempts would not be successful or would be impractical. The owner keeps the item but is compensated for the damage incurred. An appearance allowance can also be offered when the repair is less than perfect. Top Arm's-length transaction is one which is conducted within the open market freely and without abnormal pressures, such as collusion between buyer and seller. Top Assignment is a valuation service provided as a consequence of an agreement between an appraiser and a client. Top Assumption is that which is “taken to be true,” but might not, in fact, be true. Appraisals may be based on extraordinary assumptions which must be reported. (See extraordinary assumption). Top Basis of assets is the amount of the owner’s investment in the property (usually what was paid it) for tax purposes. Taxpayers may be required to use the basis of property to figure the deductions for charitable contributions and casualty losses, or to figure capital gain or loss on the sale of property. See IRS Pub. 551 Basis of Assets. Top Betterment is an insurance term which refers to the incremental increase in market value due to a repair or replacement which renders the property more valuable than it was prior to damage or loss. Top Blockage is a discount applied to value to reflect the depressive effect on value caused by the sudden offering for sale of a large number of identical or very similar items at the same time. Top Book value is an accounting term referring to the value of business assets shown on the balance sheet at historical cost less accrued depreciation. Top Bundle of rights are all of the rights, privileges and responsibilities associated with owning a property. The bundle of rights can be shared, such as happens in the case of co-owned property. Top Business personal property (a.k.a. business assets) is a non-real estate commercial asset. (See personal property) Capital gain is realized if you sell something you own (for instance a home or household furnishings) for more than your basis (typically what you paid for the property). Capital gains are taxable just as are other types of income. Top Capital gain property is that property which, if sold for its fair market value on the date of contribution, would have resulted in a long-term capital gain for the taxpayer. Included are most types of non-investment personal property held for longer than one year. Top Capitalize means to compute the present value of a business, or of an anticipated stream of income, or of an anticipated future lump-sum income. Top Client is the party or parties who engage an appraiser (by employment or contract) in a specific assignment. The client identified in the appraisal is the party or parties with whom the appraiser has an appraiser-client relationship in the related assignment and may be an individual, group or entity. Top Comparable property is a property of the same kind as the subject property and that has value characteristics identical or sufficiently similar to the subject property as to allow comparison of the properties for valuation purposes. Top Condition refers to the physical state of the property as it relates to the property being capable of giving the expected results. “Changes in condition” would include wear and tear, repairs, alterations, incompleteness, restorations, deterioration caused by inherent vice, conservation measures, etc. Top Confidential information is information, not otherwise publicly available, provided in trust by the client with the expectation that the recipient will not disclose it to another. Confidential information is also such information classified as confidential or private by applicable law or regulation. “…pursuant to the passage of the Gramm-Leach-Bliley Act in November 1999, some public agencies have adopted privacy regulations that affect appraisers. As a result, the Federal Trade Commission issued a rule focused on the protection of “non-public personal information” provided by consumers to those involved in financial activities “found to be closely related to banking or usual in connection with the transaction of banking.” These activities have been deemed to include “appraising real or personal property.” (Quotations are from the Federal Trade Commission, Privacy of Consumer Financial Information; Final Rule, 16 CFR Part 313.)” (USAP) Top Consulting (see appraisal consulting) Top Conflict of interest is any situation in which an individual is in a position to exploit a professional capacity in some way for their personal benefit. Contingent appraisal is an appraisal in which the validity of an appraiser's conclusion, opinion or analyses is dependent on the accuracy of information provided to the appraiser from other sources such as other appraisers, experts, governmental sources, lawyers, accountants, authenticators, grading services, testing facilities, etc. Top Cost is the amount of money required to create, produce, or obtain a property; cost is either a fact or an estimate of fact; the price paid for a property becomes its cost to the buyer. Cost may be equal to value (this occurs when duplicate items are being sold within the marketplace), but cost is not synonymous with value. Cost has various meanings such as "buyer's cost" and "manufacturing cost." Top Cost approach (to value) is a valuation method used when attempting to assign worth to property capable of being replaced with a new item (by production or reproduction). The cost approach measures worth based on the cost to make an exact replica or a suitable substitute property (deducting, if necessary, for various types of depreciation existing in the subject property including physical deterioration, and technical, functional, and economic obsolescence.) This approach cannot be applied to appreciable personal property and is best suited for unique, custom-made properties. Top Current appraisal occurs when the effective date of the appraisal is contemporaneous with (around the same time as) the date of the report. Top Date of appraisal (see effective date) Top Date of report is the date on which the appraisal document is prepared and signed. Top Date of inspection is the date(s) on which the appraiser examined the property or the client-provided information about the property. Top Depreciable personal property is property that decreases in value or price over time. Top Depreciation is a property's loss in value for any reason including obsolescence or due to a change in condition including physical deterioration; an incremental reduction in value based on age/life formulas commonly used within the insurance industry. In appraising, depreciation is defined as a property's loss in value from new for any reason, whether caused by intrinsic characteristics (rusting, decay, obsolescence) of the property or to factors that are external to the item (e.g., change in fads); in regards to improvements to land, such as a home or school building, depreciation is defined as the degree of deterioration and obsolescence; in accounting, depreciation is an allowance that is tied to income tax laws, and is a way to approximate the "charging to expenses" of the original cost of business assets used for more than one accounting period. Top Diminution of value (see loss-of-value) Top Disclaimers & Terms of Use cover issues pertaining to the conditions and presuppositions under which the appraisal assignment was conducted and to issues relating to how the report can be used. They 1) cover assignment-relevant issues to protect the appraiser where errors or omissions might be charged or imputed, and 2) limit the use of the appraisal to those for whom its use was intended. Top Distress liquidation market (see forced liquidation market) Top Donee is the recipient of funds, donations or other benefits. Top Donor is the person or entity that makes a gift. Top Due diligence is a concept that applies to all phases of the appraisal process — both in the development of the appraisal as well as in the reporting of the results. It is particularly applicable when dealing with issues of authentication. Courts hold professionals to higher standards of duty than it holds non-professionals. Exercising due diligence is one of those higher standards. It requires the appraiser to meet the standard of substantial evidence in all phases of the appraisal process. Substantial evidence is "such evidence as a reasonable person might accept as adequate to support a conclusion." (Black's Law Dictionary) Top Earnings forecast is an estimate of the future net monetary returns of investment property. Top Economic obsolescence is the passing out of usefulness due to external factors such as a decrease in demand (because of changes in style, vogue, or fashion), the establishment of restrictions against use or ownership, or a prohibitive increase in the cost to manufacture. Top Effective date of the appraisal is the date as of which the value conclusion applies, e.g., the date of loss in the case of an insurance claim, or the date of donation for noncash charitable contribution appraisals done for income tax purposes. Top Equitable distribution is a fair division of assets between two or more entities (people or businesses); the division is based upon an agreed-upon method or may be at the direction of third party or court. Top Evaluation is the process of determining the non-monetary qualities of property that contribute to value such as quality, authenticity, or rarity. Top Executor or executrix (of a decedent's estate) is one named in a decedent's will to administer the estate and distribute properties as the decedent has directed. (see administrator and personal representative) Top Expert witness as used in a judicial proceeding is a person duly and regularly engaged in the practice of a profession who holds a professional degree from a university or college and has had special professional training and experience, or one possessed of special knowledge or skill about the subject upon which called to testify. Top Extraordinary assumptions are assumptions, directly related to a specific appraisal assignment, on which the appraiser bases his opinions or conclusions. If false, extraordinary assumptions could cause the appraiser's opinions or conclusions to be in error. Extraordinary assumptions presume as fact otherwise uncertain information about the property or about conditions external to the property, such as market conditions or trends. Top Fair market value is a specific type of market value and is defined by a legal or regulatory jurisdiction and varies with individual jurisdictions. For Federal uses such as estate and gift tax or charitable contributions, fair market value is defined by Internal Revenue Regulation §1.170A-1(c)(2) as "The price at which property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or to sell and both having reasonable knowledge of the relevant facts." Treasury Regulation §20.2031-1 elaborates on this definition by stating “The fair market value of a particular item of property includible in the decedent's gross estate is not to be determined by a forced sale price. Nor is the fair market value of an item of property to be determined by the sale price of the item in a market other than that in which such item is most commonly sold to the public, taking into account the location of the item wherever appropriate. Top Forced liquidation market is any market in which property is sold quickly, within a very restricted time frame, without the freedom to consider exposure or price and, often, without regard to the most appropriate marketplace. Top Forced liquidation value (for personal property) is the most likely price an item would obtain within a market which may or may not be the most appropriate (i. e., most lucrative) market. The property is sold immediately by a seller under compulsion to exchange property for cash. Forced liquidation value for business assets is the value realized when assets are sold piecemeal, under duress at public auction. Forced liquidation value assumes that the buyer is responsible for all costs of removal and is purchasing the assets "as is, where is" with no warrantees or representations as to the condition of the assets being made by the seller. It is further assumed that the assets are properly advertised in a manner considered to be commercially reasonable. Top Fractional appraisal is an appraisal of one component or legal interest of the whole property. It is an appraisal in which a value estimate is made on one of the component parts or a percentage of an item with or without regard to the effect of the component's separation from the whole. An example would be the appraisal of restaurant fixtures and equipment (F & E) as opposed to the restaurant building and land. An appraisal of the F & E is a fractional appraisal of the restaurant as a going-concern business. Top Fractional interest is a partial interest in a property. In personal property, co-ownership represents fractional interests. In real estate the divided interests of the owner, lessee, mortgagee, easement holder, etc. represents fractional interests. Top Functional obsolescence is the passing out of usefulness due to the inability of the item to produce the desired results (due to inadequacy, unattractive style, poor or inefficient design, etc.) and to the availability of a new replacement capable of achieving the same results. The old and the new items must be of comparable design and category. Top Going concern is an operating business enterprise that is expected to continue. Top Going concern value is the value of an operating business enterprise. Goodwill is an integral component of going concern value. Top Goodwill is an intangible business asset category usually composed of elements such as name or franchise reputation, customer patronage, location, products, and similar factors.Top Goodwill allowanceis a term used in the claims industry to describe a payment made to the shipper (or insured) which compensates for what the industry considers to be only a perceived loss, damage or inconvenience, but which the shipper (or insured) feels to be a real loss, damage or inconvenience. To placate the insured (or shipper) the insurance company (or moving company) could authorize an allowance be paid as a gesture of goodwill. Top Gross proceeds of a sale equals the total proceeds realized from the sale before subtracting costs associated with the sale such as auctioneer's commission, hauling, advertising, taxes, post-sale clean-up, etc. Top Highest and best use is that reasonable and legal use of a property that will result in its greatest value. The principle of highest and best use recognizes the need to consider the item's ultimate use as well as the most appropriate marketplace which, taken together, results in the highest value for the property under consideration. Top Historical cost is the cost of the item when it was first placed in service; also known as base price. (See original cost) Top Hypothetical appraisal is an appraisal in which the appraiser's opinions or conclusions are based on a hypothetical condition. Top Hypothetical condition is a condition which is contrary to what exists as of the effective date of the appraisal, but that is supposed to exist for the purpose of the appraisal assignment. Top Income approach is a valuation approach that estimates the present value of an income-producing property through capitalization of the net income that is expected to be produced by the property during its remaining useful life. Top Inherent vice is defined as an intrinsic characteristic of an object, material or property that results in its tending to deteriorate or destroy itself. These hidden or latent defects over time or when combined with the ambient conditions of humidity, temperature, light and gravity, contribute to the property damaging itself. The loss is caused by the inherent nature of the thing insured and not the result of a casualty or of an external cause. Top Intangible property (intangible assets) is property that cannot be perceived by the senses including but not limited to franchises, trademarks, patents, copyrights, goodwill, equities, mineral rights, securities, mailing lists and contracts; as distinguished from tangible physical assets such as facilities and equipment. Top Intended use of an appraisal report is the way in which the client will use the appraiser's reported opinions, conclusions, or analyses. The intended use is identified by the client at the time of the assignment. Examples of intended uses include for selling property, divorce, acquiring insurance coverage, donation, bankruptcy or estate tax. Top Intended user is the client or any other party, identified by name or type as users of assignment results by the appraiser based on communication with the client at the time of the assignment. Top Investment property is property expected to generate income in the form of either a stream of monetary returns or as a one-time future sale at which time a profit is anticipated. Investment property has primarily investment value, but could also have market value and owner value. Top Internal Revenue Regulation §1.170A (pertains to Income Tax Charitable Deduction) allows as a deduction any charitable contribution (as defined in §170(c)) which is made during the taxable year.
Internal Revenue Regulation §20.2031 (pertains to Estate Tax)
Investment property is property expected to generate income in the form of either a stream of monetary returns or as a one-time future sale at which time a profit is anticipated. Investment property has primarily investment value, but could also have market value and owner value. Top Investment value is the present worth of a monetary return anticipated to be realized over a period of time as a result of owning invested property. Top Irreplaceable property is that property for which a duplicate or suitable equivalent cannot be either purchased or reproduced. Examples include an artist's original oil painting, or JFK's golf bag, or the Hope Diamond. While a similar item might be found, it can never be suitably equivalent as characteristics of provenance, antiquity or authorship cannot be duplicated with any replacement property.Top Lessee is the leaseholder, the one who rents the property, the tenant. Top Lessor is one who grants a least, the owner of the property, the proprietor. Top Limiting conditions are circumstances or conditions that could affect the appraisal development process and, possibly, the appraiser's opinions or analyses. Limiting conditions are often brought about when the property is not available for personal inspection by the appraiser, or by ambient conditions such as the unavailability of electrical power to test appliances and electronic equipment. Top Liquidation value is a specific type of market value. It is most often considered to be the value-in-place of property from a failed business that is scheduled to be sold intact as of a specific date within a limited time fame in order to satisfy creditors. But for personal property, liquidation value represents the amount of money that would be obtained when converting any property to cash for any reason within a defined time period. Orderly liquidation value assumes adequate time to prepare for and/or advertise the sale. Forced liquidation value assumes inadequate time is allowed to properly prepare and/or advertise the sale. (See Orderly Liquidation Value and Forced Liquidation Value) Top Loss-of-value is the degree to which an item has lost worth because of damage and subsequent professional repair/restoration. The loss-of-value of an item equals the difference in market value of the property prior to damage and the market value of the property after damage has been repaired. Top Market analysis is the study of market conditions for a specific type of property. For personal property, there may be more than one market which would require analysis. This might occur if the subject property is bought and sold within more than one marketplace, such as an item that can be found in both the retail as well as the wholesale market. Top Market value is a general concept defined as an opinion of the most probable buy-sell price; the amount of money a buyer would pay and a seller would accept for an item of property under "specific conditions." Specific conditions must always be set forth in the definition of any value term identified by the appraiser as being applicable to the appraisal assignment. Market value presumes the transfer of property (i.e., a right of ownership or a bundle of rights) as of a certain date and under those certain conditions as set forth in the definition of the term as identified by the appraiser. "Conditions" may include (1) the relationship, level of knowledge, and motivation of seller and buyer, (2) the terms of sale (cash vs. cash equivalent), and (3) the condition of sale (e.g., exposure in the most appropriate marketplace for a reasonable time prior to sale). Because of the varying definitions of market value, appraisers must identify the exact definition of market value, and its authority, in each appraisal completed for the purpose of determining market value. Top Marketable cash value is the net proceeds (gross proceeds less expenses) of a sale. Expenses associated with a sale might include advertising, auctioneer or broker's commission, transportation costs, photography costs, trash removal after an on-site auction, etc. Top Marketable non-investment property (examples include most personal property) is that saleable property which is held without the expectation of earning income. Has market value and owner value; does not have investment value. Top Mass appraisal is the process of valuing a universe of properties as of a given date utilizing standard methodology, employing common data, and allowing for statistical testing; seldom used by the personal property appraiser. Top Mean (or average) is a statistical term of central value tendency which refers to the statistical average of the observations calculated by dividing the sample total summation by the number of samples. Top Net proceeds equals the gross proceeds from a sale less costs associated with the sale such as auctioneer's commission, hauling, advertising, taxes, etc. Top Net value is a term commonly used in equitable distribution proceedings (divorce, business dissolution, estate division) to indicate the market value of property less any encumbrances (such as liens or debt), expected selling commissions, and other costs which would serve to reduce the property's value. Top Non-investment property is property owned without the anticipation of income. Personal household property is non-investment property. Top Non-marketable non-investment property (a.k.a. service property). is property which is non-marketable and which is not held with the expectation of earning income. It has only owner value but not market value or investment value. Examples in real property include a church, library or school. Personal property examples include contraband items such as artifacts taken from Native American grave sites, or those items made from parts of an American bald eagle or other endangered species of flora or fauna. Top Objective of an appraisal is what the appraiser has been asked to determine. It is what the appraiser is seeking. Examples include determining market value, estimating replacement value based on replacement cost, and calculating present worth. Top Obsolescence is the passing out of usefulness due to there existing a functionally or technologically newer or better replacement, or because of a decrease in demand due to changes in style, fashion, or public perception. Eventually the property is considered obsolete and is retired from use. Top Online appraisals are electronically-transmitted personal property Internet appraisal reports based on client-provided digital images and written descriptions. The uses of online Internet appraisals are valid in situations in which the uses of photographs have traditionally been considered a typical appraisal practice. Top Orderly liquidation market is the market in which property is regularly sold in an orderly and advertised fashion but for which nominal time constraints apply. Examples are auction galleries, on-site auctions, consignment shops, and estate tag sales. Top Orderly liquidation value (for personal property) is the most probable price for which an item would change hands between knowledgeable buyers and sellers if sold in an orderly manner, properly advertised, and allowing a reasonable amount of time to complete the transaction in an appropriate marketplace. For business assets, orderly liquidation value is the value realized when assets are sold piecemeal, through negotiation, over a predetermined period of time (often three to six months). Orderly liquidation value for business assets assumes that the buyer is responsible for all removal costs and is purchasing the assets "as is, where is'" with no warrantees or representations as to the condition of the assets being made by the seller. It is further assumed that the assets are properly advertised in a manner considered to be commercially reasonable. The would-be buyer and seller of business personal property further acknowledge that if an acceptable price cannot be negotiated within the time period specified the final option would be to offer the assets for sale at public auction. Top Ordinary income property is property which, if sold on the date of donation, would have resulted in either ordinary income or in a short-term capital gain. Examples of the former include works of art created by the donor, and dealer stock. An example of the later includes personal property held for less than one year. Top Original cost is the cost of acquisition to the current owner. (see historical cost) Top Owner value (a.k.a. functional value) recognizes the non-monetary satisfactions the owner enjoys as a result of owning the property. Owner value cannot be measured as it is perceived and in the mind of the owner. Owner value may be more than fair market value or replacement cost if the owner perceives it as such, e.g., because of "sentimental" value. The value an owner places on personal property may be higher than the price he might get for the property by sale. Top Ownership rights are defined as the right to own, use, consume, transfer title, sell, etc. property. Top Personal property is any tangible or portable objects which are considered by the general public as being "personal," i.e., items which are decorative, utilitarian or collectible such as furnishings, artwork, antiques, gems & jewelry, clothing, machinery and equipment; all property that is not classified as real estate. Non-real estate commercial assets are referred to as business personal property. Top Personal representative (of a decedent's estate) is an executor, administrator, or anyone who is in charge of the decedent's property. Top Preexisting damage (PED) is a term encountered when conducting an insurance casualty loss or a transit-related damage claims appraisal. It is damage, wear and tear, earlier repairs, or other change from "like-new" condition which existed prior to a household goods move or prior to the date of a casualty loss. Top Primary market is one in which new items that are still being created by the manufacturer are available for sale for the first time. As an example, a primary market for Hummel figurines is a gift shop that carries new Hummels which are currently in production. (See secondary market) Top Present worth is an accounting term which represents the current amount, in terms of dollars, that would be the equivalent of income generated by the sale of property at some point in the future or of the stream of income generated by leasing property for a specified amount of time. Top Price is variously used to indicate the amount of money asked, offered or paid for a property; most commonly thought of, however, as the amount of money being asked for a property being offered for sale; because of motivations of a given buyer or seller, price may or may not have any relationship to the value which might be ascribed to that property by others. Top Production cost (See replacement cost (new – production)) Top Property. When valuing an item or when estimating its present worth, the term property means the rights an owner of that property anticipates to accrue by virtue of ownership. When estimating an item's replacement cost, the term property refers to the item itself without regard to ownership. (see business personal property, real property, personal property, tangible property, intangible property, appreciable personal property, depreciable personal property). Top Prospective appraisal is one in which the effective date of the appraisal occurs after the date of the report. Top Provenance reflects the place of origin and history of the property including such as its past ownership, exhibitions showing the item, literature mentioning the particular property, etc. Top Qualifying organization is one that is recognized by the IRS as exempt from Federal income tax; normally organized for one of the following purposes: charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, or prevention of cruelty to children or animals. To qualify the organization must be a corporation, community chest, fund, or foundation. Taxpayers may be allowed to deduct the fair market value of noncash charitable contributions but only if made to a qualifying organization. Top Reasonable time. (1) In regards to fair market value, reasonable time is a sufficient duration of time so that neither the seller nor the buyer is under compulsion to act. The concept of fair market value assumes that a reasonable time is available in which the transaction can occur. Time allowances are made for such necessities as transporting, cleaning, repair, advertising, and conducting the sale in an orderly fashion. (2) In regards to insurance and replacing lost or damaged property, reasonable time is that amount of time needed by the insured acting as a prudent purchaser to obtain a replacement property from the marketplace in which he normally makes purchases. Top Real property or real estate is an identified parcel or tract of land, including improvements thereon, if any, such as a building or playground. Top Related-use as it applies to noncash charitable contributions refers to property which is related in some fashion to the mission of the qualifying donee organization. Top Relative ranking (see value ranking) Top Replaceable property is that property that can be replaced by purchase or reproduction of another property that is 1) either identical, or 2) that is considered a suitable equivalent. Top Replacement cost is an insurance term used to mean the cost required to obtain an item of personal property (through purchase or manufacture as the case may be) to replace an insured property that was lost, damaged or destroyed. The replacement property should be of like kind and have similar characteristics such as age, authorship and condition, etc. as the damaged or destroyed property. Replacement cost takes into consideration possible additional costs which might be incurred such as sales taxes, engaging an interior designer, shipping, etc. Depending on the type of insured property, replacement could be with a either a new property or a comparable property. Top Replacement cost new. For items capable of being replaced with a new property, replacement cost (new) is the cost necessary (by purchase or manufacture) to replace the item with a new item of like kind, quality and utility or with new upgraded items. Replacement cost (new) applies to depreciable property for which exact or suitably-acceptable new substitutes can be found. Note that replacement cost (new) considers that items may be upgraded to the latest model or style if the subject property model has been discontinued.Top Replacement cost new less depreciation is defined as the cost of replacing the property at the time of loss with a new item, less a proper deduction for depreciation, if any. Top Replacement cost (comparable). For items not capable of being replaced with a new property, replacement cost (comparable) is the cost necessary (by purchase) to replace an item (from within the insured’s most relevant marketplace and within a reasonable amount of time) with a comparable item of like kind, age, quality, and utility having similar wear and tear, decay or defects, obsolescence and value characteristics as the subject item. Replacement cost (comparable) applies to property for which exact duplicates cannot be found such as for antiques, collectibles, or works of art by a deceased artist. Replacement cost (new - production) is the total cost of constructing an equally good substitute (i.e., an equivalent item) but not an exact duplicate item. Replacement cost (new - reproduction) is the total cost of constructing an exact replica by the original artist, or a qualified artist or craftsman, using the same materials, plans and construction techniques as the original. Replacement value is a type of market value and is a general concept that is primarily applicable to insurance appraisals. Replacement value represents the amount one would have to pay (i.e., the buyer's cost) to replace an item of property (through purchase or manufacture as the property warrants) with a property of like kind, age, condition and quality that would provide the same enjoyment, usefulness and other rights of ownership as did the insured property. Replacement value is based on replacement cost. Top Replacement value (comparable) is the amount necessary to obtain a comparable substitute property that would provide the same enjoyment, usefulness and other rights of ownership as did the insured property. It is based on the substitute property's replacement cost (comparable). Replacement value (new) is the amount necessary to obtain a new substitute property that would provide the same enjoyment, usefulness and other rights of ownership as did the insured property. It is based on the substitute property's replacement cost (new). Report is any communication, written or oral, of an appraisal, appraisal review or appraisal consulting service that is transmitted to the client upon completion of an assignment. Most reports are written and most clients mandate written reports. Oral reports may be required in court testimony or given at “Heirloom Discovery Days” venues.
Reproduction cost (see replacement cost (new – reproduction)) Top Restricted use appraisal report (see report) Top Retail price is the price the ultimate consumer is asked to pay for an item in the retail market. Top Retail market is the market in which items are sold at retail, i.e., to the end consumer. Examples include discount stores, antique shops, art galleries, jewelry stores, department stores, etc. when sales are made to the end consumer. Top Retrospective appraisals provide a value conclusion as of an effective date which is prior to the date of the report. A retrospective appraisal mentally goes back in time to the effective date and applies data as of that earlier date and not after. Top Reversionary value is the value remaining in an investment property after a specified number of returns have been received. Top Review (see appraisal review) Top Sales comparison approach is a valuation approach that bases a subject property's value on market data including the selling price of identical or similar (comparable) properties that have recently sold or on the asking prices of identical or comparable items currently being offered for sale. Top Salvage value is a type of market value and is the amount of money that could probably be obtained from the sale of an obsolete item or of a damaged item for which repair is neither desired, possible nor economically feasible, i.e., the repair costs exceed the item’s worth. Top Scrap value is a type of salvage value and is the amount of money that would probably be obtained for a property that was being broken up to obtain intrinsically valuable materials, e.g., scrap steel in a wrecked car or the gold in damaged jewelry. Top Scope of work is the amount and type of information researched and the analysis applied in an assignment. scope of work includes, but is not limited to the following:
Self-contained appraisal report (see report) Top Secondary market is one in which items that are still being created by the manufacturer are being resold. An example of a secondary market for Hummel figurines is an estate auction or a yard sale at which Hummels that are still in production are being resold a second, third or more time. Note: When the item is no longer being created by the manufacturer, the secondary market becomes the primary market. (see primary market) Top Service property (see non-marketable non-investment property) Top Signature (on an appraisal report) is personalized evidence indicating authentication of the work performed by the appraiser and the acceptance of responsibility for the content, analyses, and the conclusion of the report. A signature can be represented by a hand written mark or a digitized image where the appraiser has sole personalized control of affixing the signature. Every appraisal must contain a signed USPAP Certification Statement.Top Similar property (as used in connection with non-cash charitable contributions) means property of the same generic category or type, such as stamp collections, coin collections, lithographs, paintings, photographs, books, furniture, etc. Top Substantial evidence is "such evidence as a reasonable mind might accept as adequate to support a conclusion" (Black's Law Dictionary). Substantial evidence must be free of bias or personal interests whether financial or emotional. Top Summary appraisal report (see report) Top Tangible property is property that can be seen or touched. Top Technological obsolescence is the passing out of usefulness due to the ability to duplicate the same results with a new replacement using new technology and modern manufacturing materials and techniques. Top Terms of Use (see disclaimers & terms of use) Top Tort is any wrongful act, damage, or injury done willfully, negligently, or in circumstances involving strict liability (but not involving breach of contract) for which a civil suit can be brought. (Webster's) Malpractice and fraud are examples of torts. Top United States Tax Court (Tax Court) is a federal court that handles disputes involving income, estate, gift, and other taxes. Taxpayers who cannot reach an agreement with the Internal Revenue Service may file a petition with the U.S. Tax Court. The court has offices in Washington, D.C., but it holds sessions at locations throughout the country for the convenience of taxpayers. Top USPAP is an acronym for the Uniform Standards of Professional Appraisal Practice as promulgated by The Appraisal Foundation of Washington, DC. Top Valuation (synonymous with appraisal) is the act of determining the monetary value of the rights encompassed in ownership as of a particular date and within a specified market. Top Valuation services are those services pertaining to all aspects of property value and include services performed both by appraisers as well as by non-appraisers including attorneys, accountants, insurance estimators, automobile dealers, auctioneers, and brokers. (see appraisal practice) Top Value is the monetary relationship between properties and those who buy, sell or use those properties; value expresses an economic concept and, as such, is never a fact but rather an opinion of worth at a given time in accordance with a specific definition of value; therefore, value must always be qualified as to type such as market value, liquidation value, investment value. Top Value characteristics are qualities, attributes, features or aspects which, in the eyes of the interested parties, add to or detract from value. Examples include quality of construction, age, authorship, country of origin, aesthetic qualities, subject matter, materials, etc. Top Value-in-exchange is the amount of money the property would bring if sold. Value-in-exchange is normally less than the original purchase price for depreciable property such as an everyday sofa, but it could be more than the original purchase price for appreciable property such as an antique or a work of art. The concept of value-in-exchange is basic to the definition of market value. Top Value-in-place is the value of business assets taking into consideration the extent to which the property contributes to the success of an enterprise. Value-in-place recognizes a "premium" in value over the property's value if it were not "in place" and making the contribution. Top Value-in-use is the value of personal property taking into consideration the extent to which the property contributes to the personal needs, satisfactions or requirements of the owner; may take sentimental value into consideration. Top Value ranking is a concept which declares that the value of a property is relative to the position in which its value characteristics are ranked against the value characteristics of properties with which it is being compared. The most frequent rankings are in the area of condition and quality. Top Voir dire is a mini-hearing held during a trial on the acceptability of a juror, on admissibility of contested evidence, or the acceptability of one being offered as an expert witness. For example, a defendant may object to a plaintiff's expert witness. Top Wholesale market is the market in which wholesalers can sell to the trade and dealers can buy for resale to the public. Top Workfile is the written, electronic or photographic documentation necessary to support an appraiser's analysis, opinions and conclusions. Top |
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