Barry Shea and Associates
Professional real property appraisal services in central New Hampshire
Barry Shea and Associates provides professional real estate appraisal services throughout central New Hampshire. Our experience includes appraisals of a wide range of residential and small commercial properties. Our service area includes all of Belknap and Merrimack Counties and much of Carroll, Grafton and Strafford Counties.
All of our appraisal reports are completed to conform with the Uniform Standards of Professional Appraisal Practice (USPAP). These standards provide a set of criteria within which the licensed or certified appraiser must work. The standards require that the appraiser provide services ethically and competently.
USPAP differentiates between the appraisal and the appraisal report. The term appraisal refers to the process of developing an opinion of value. An appraisal report is the medium by which the results of an appraisal are communicated to the client. The appraisal report must "contain sufficient information to enable the intended users of the appraisal to understand the report properly" (Standards Rule 2-1(b)).
Depending on the property being appraised, the intended use of the appraisal and the quality and quantity of relevant market data, the appraiser will use one or more of the three approaches to value. These approaches are the Cost Approach, the Sales Comparison Approach, and the Income Approach.
The Cost Approach to value is based on the premise that a rational buyer will not pay more for a property with existing improvements than it would cost to produce a property of equal utility in a comparable location. There are several published cost manuals available that provide current, localized cost estimation data. This data is often supplemented with additional specialized data from local sources. The total estimated depreciation is subtracted from the cost to build, and the difference is added to cost of the site with utilities and other site improvements.
The Sales Comparison Approach to value is based on the assumption that most market participants will compare properties and, all things being equal, will not pay more for one property than for another property of the same utility in a comparable location. Recent sales are researched by the appraiser. The most relevant sales are verified and analyzed with adjustments applied for value related differences between the sold properties and the subject property.
The Income Approach assumes that there is a relationship between the amount of income a property can generate and its market value. A common application of the Income Approach is direct capitalization. In direct capitalization, income and expense data from recent sales are collected, verified and analyzed to develop a "cap rate" which is then applied to the subject property's net operating income to yield a value estimate.
Once the relevant approaches have been developed, the value estimates from the approaches must be reconciled. The amount of weight placed on the indicated value from each approach will vary from assignment to assignment depending on the reliability of data and applicability of the approaches developed.
Finally, a report is written and delivered to the client.
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