Paper Topic:

Cost Approach- Contemporary Issues Essay

an area . However , a generalized cost approach can actually be done on available improved sales that might reasonably be compared to the subject property . Start with the true comps for the subject . If they are in the same condition- and you are supposed to find that out so that you can make meaningful comparisons- then you should be able to replace those comparable improvements (theoretically ) on paper . Once you depreciate them , you can then deduct the depreciated cost of the improvements from the sales price . The result is an indication of the site under those improvements

This technique is

called abstraction or extraction

The second technique is allocation

Where you know the ratio between land and building values in an area , you can simply apply the land percentage to the overall value and obtain the land portion . Clearly , this is the easiest method since it involves only one calculation however , it does assume that you have , over at least some volume of work , done these calculations on a material number of properties

So , what do you do if your subject neighborhood does not yield adequate amounts of data ? Then , go to the nearest comparable area and use the data from that area in which the values , appeal etc . are similar to the subject s area

Issue

What cost data services are the best

The answer is obvious : the best ones are those that are the most accurate and the easiest to use

Less obvious , of course , is how to make that determination , and the process is going to be an individual exercise

Two of the most popular are Marshall Swift and Bluebook . Since both are exhibitors at this conference , I encourage all to visit their booths and discuss how they compile their data and how to use their services

Issue...

8 pages

12.7 KB

Free sing-up