Ubc real estate assignment answers

REAL ESTATE Appraisal

BUSI 330

Residential

Appraisal Report

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Real Estate Division

ADDRESS OF

SUBJECT PROPERTY:

PREPARED BY:

Student Name

Student Number

Grader

Mark %

Letter Grade

RESIDENTIAL APPRAISAL REPORT (BUSI 330, Project No. 2)

LETTER OF TRANSMITTAL INFORMATION

Page i

PHOTOGRAPHS OF SUBJECT

FRONT VIEW

(Showing Depth)

REAR VIEW

Page ii

TABLE OF CONTENTS

Section
Page Number
Photographs of Subject Property

Table of Contents

Summary of Salient Facts and Important Conclusions

i

ii

iii

Part I - Preface
Definition of the Appraisal Problem

Assumptions and Limiting Conditions

Regional and Area Analysis (optional)

Neighbourhood Analysis and Trends (optional)

Land Description and Analysis (optional)

Description of Improvements (optional)

Description of Improvements: Observed Depreciation

1

2

Part II - Analysis and Conclusions
Highest and Best Use Estimate

Cost Approach - Land Value

- Cost Analysis of Improvements

- Depreciation

- Summary

Direct Comparison Approach

Reconciliation of Value Indications and Final Estimate of Value

Certification

Schedules
Addenda Item/
Page No.

City/Regional Map

Neighbourhood Map

Site/Plot Plan (optional)

Floor Plan(s) (optional)

Comparable Land Sales Map

Cost Summary; Cost Manual/Service Excerpts and Worksheets

Comparable Improved Sales Map

Photographs of Improved Sales

Additional Photographs of Subject (optional)

Neighbourhood Photographs (optional)

Transfer and Mortgage Documents for Comparables (optional)

Other Materials (list)

A

Page iii

SUMMARY OF SALIENT FACTS AND IMPORTANT CONCLUSIONS

Type of single family dwelling:

Address of property:

Effective date of the appraisal:

Dimensions and area of site:

Dimensions and area of building(s):

Highest and best use:

Estimate of land value (as if vacant):

Estimate of value by Cost Approach:

Estimate of value by Direct Comparison Approach:

Final estimate of value:

Page 1 of pages

DEFINITION OF THE APPRAISAL PROBLEM

PURPOSE of the appraisal is to estimate the Market Value of the subject property as at the effective date of appraisal. FUNCTION of the report is for the awarding of credits for completion of course BUSI 330.

Present registered owner

Past sales history (5 years)

Legal description

Encumbrances

Mortgage information

[ ] No mortgage

1st held by

2nd held by

Principal

outstanding

Monthly

payments

Are taxes

included?

Date

due

Interest

rate

Amortization

period

Conditions

1st

$

$

%

2nd

$

$

%

Rights-of-way, other encumbrances

[ ] none

[ ] (if any, describe)

Definition of property rights appraised

The Fee simple estate is "Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, expropriation, police power and escheat."

Appraisal of Real Estate (3rd Canadian edition)

Definition of market value

Market value is defined in the Appraisal of Real Estate (3rd Canadian edition) as: "The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress."

Effective date of appraisal

Page 2 of pages

ASSUMPTIONS AND LIMITING CONDITIONS

This report is subject to the following assumptions and limiting conditions.

1. Legal description is that which is recorded in the Registry or Land Title office and is assumed to be correct.

2. Every effort has been made to verify the information received from others which is believed reliable and correct.

3. Sketches, drawings, diagrams, photographs, etc., are included for the sole purpose of illustration and serve to assist the reader in visualizing the property.

4. The distribution of land and building as stated in this report, apply only under the program of utilization as identified in the report.

5.

6.

7.

Page of pages

DESCRIPTION OF IMPROVEMENTS

DESCRIPTION OF BUILDING

Dimensions

Area

Type/style

Year Built

Foundation

[ ] Poured concrete

[ ] Concrete blocks

[ ] Concrete posts

[ ] Wood posts

Framing

[ ] Wood

[ ] Concrete

[ ] Steel

[ ]

Basement

[ ] Full

[ ] Partial

[ ] None

[ ] Slab

[ ] Crawl space

Basement Finish

Exterior Walls

Brick veneer

Clapboard

Stucco

Siding:

Vinyl

(percentage)

Wood

Stone veneer

Aluminum

Solid masonry

Aluminum

Roof

[ ] Asphalt shingles

[ ] Wood shingles or shake

[ ] Slate

[ ] Clay/tile

[ ] Built-up tar & gravel

[ ] Gutters & down spouts

[ ]

Interior Walls

[ ] Dry wall

[ ] Plaster

[ ] Paneling:

type

Floor Coverings

Above ground

Carpet

Tile

Ceramic

Hardwood

Linoleum

(percentage)

Basement

Carpet

Tile

Linoleum

Other

Fireplaces

Number:

Location:

Type:

Kitchen

[ ] Built-in dishwasher

[ ] Garburator

[ ] Built-in range

and oven

[ ] Exhaust fan

[ ] Vent hood

Cabinets - type and material:

Quality

Counter material:

Other features

Fixtures:

Quality

Electricity

No. of amps:

[ ] Circuit breakers

[ ] Fuses

Plumbing

Pipes

[ ] Copper

[ ] Galvanized

[ ] Mixed

Hot water tank

[ ] Electricity

[ ] Gas

[ ] Oil

Capacity:

Connections

[ ] Washer

[ ] Dishwasher

[ ]

Drainage

[ ] Plastic

[ ] Galvanized

[ ]

Heating

[ ] Forced air

[ ] Hot Water

[ ] Steam

[ ]

[ ] Oil fired

[ ] Gas fired

[ ] Electric

[ ] Humidifier

Air Conditioning

[ ] Yes

[ ] No

[ ] Central

Swimming pool

[ ] Yes

Type:

Garage

[ ] Single

[ ] Double

[ ] Attached

[ ] Detached

[ ] None

[ ] Carport

[ ] Electricity

[ ] Heated

[ ] Interior finish

Type of construction:

Flooring:

Dimensions:

Area:

Porch

[ ] Open

[ ] Screened

[ ] Enclosed

Size:

[ ] None

Patio/Deck

[ ] Concrete

[ ] Wood

[ ]

Size:

[ ] None

Rental Equip.

[ ] Water softener

[ ] Hot water tank

[ ] Furnace

[ ]

[ ] None

Page of pages

DESCRIPTION OF IMPROVEMENTS (continued)

Please identify each room with an “X”, or if more than one, indicate with a number

Room List

Foyer

Living

Dining

Kitchen

Den

Family Room

Bedrooms

No. Baths

Laundry

Other

Basement

1st Level

2nd Level

Finished area above grade contains a total area of

rooms

bedrooms

baths

Finished basement area contains a total area of

rooms

bedrooms

baths

Bathroom location

Description of fixtures installed

*Comments required

Good

Average

Fair

Poor*

Energy efficiency and insulation level

[ ]

[ ]

[ ]

[ ]

Quality of construction (materials and finish)

[ ]

[ ]

[ ]

[ ]

Condition of improvements

[ ]

[ ]

[ ]

[ ]

Rooms size and layout

[ ]

[ ]

[ ]

[ ]

Plumbing – adequacy and condition

[ ]

[ ]

[ ]

[ ]

Electrical – adequacy and condition

[ ]

[ ]

[ ]

[ ]

Kitchen cabinets – adequacy and condition

[ ]

[ ]

[ ]

[ ]

Compatibility to neighbourhood

[ ]

[ ]

[ ]

[ ]

Overall livability

[ ]

[ ]

[ ]

[ ]

Appeal and marketability

[ ]

[ ]

[ ]

[ ]

Additional features

Recent modernization, renovation, and major repairs

Site improvements

[ ] Driveway

[ ] Paved

[ ] Gravel

[ ] Concrete

Area:

[ ] Fence

[ ] Wood

[ ] Chain link

[ ]

Length:

Height:

[ ] Landscaping

Description

[ ] Other

Describe

Page of pages

DESCRIPTION OF IMPROVEMENTS: OBSERVED DEPRECIATION

Condition of Building

Physical Depreciation - Curable

Physical Depreciation - Incurable

Short-lived:

Long-lived:

Age concept

No. of years

Chronological age

yrs.

Effective age

yrs.

Economic life

yrs.

Remaining economic life

yrs.

Justification of Effective Age and Economic Life:

Functional Obsolescence

External Obsolescence

Page of pages

HIGHEST AND BEST USE ESTIMATE

Definition

Highest and best use is defined in the text Appraisal of Real Estate (3rd Canadian edition) as "the reasonably probable and legal use of vacant land or an improved property that is physically possible, legally permissible, appropriately supported, financially feasible, and that results in the highest value".

Analysis and support of highest and best use of the site, as if vacant

Discussion of adequacy of the existing improvement(s)

Conclusion and support of highest and best use as improved

Page of pages

COST APPROACH - LAND VALUE

Data Comparison Chart

Item

Subject

Comparable no. 1

Comparable no. 2

Comparable no. 3

Address

Legal description

Sale date

Instrument no.

Registration date

Vendor

Purchaser

Sale price

Right conveyed

Fee simple

Financing

Conditions of sale

Expenses made immediately after purchase

Time difference (mos)

0

Zoning

Location

Frontage/depth

Lot area

Topography

Utilities

Interior/corner lot

Local Improvement Charges

Easements/Rights of Way

Other comments

Page of pages

COST APPROACH - LAND VALUE (continued)

Adjustment Chart

Item

Comparable no. 1

Comparable no. 2

Comparable no. 3

Sale price

Real property rights conveyed adjustment

Adjusted price

Financing adjustment

Conditions of sale adjustment

Expenses made immediately after purchase adjustment

Adjusted price

Date of sale adjustment

Adjusted price

Other adjustments as required:

- Zoning

- Location

- Frontage/depth

- Lot area

- Topography

- Utilities

- Interior/corner lot

- Local Improvement Charges

- Easements/Rights of Way

Total Other Adjustments

Final Adjusted Sale Price

Adjusted unit sale price / frontage OR

Adjusted unit sale price / area

For reconciliation purposes:

Total Adjustment

Total adjustment as % of Sale Price

Page of pages

COST APPROACH - LAND VALUE (continued)

Adjustment Analysis in Order: 1. Property Rights 2. Financing 3. Motivation 4. Expenses made immediately after purchase 5. Time 6. Other

Page of pages

COST APPROACH - LAND VALUE (continued)

Reconciliation

Final Estimate of Site Value: $

Page of pages

COST APPROACH – COST ANALYSIS OF IMPROVEMENTS

Reproduction Cost New (RCN) Estimate

Cost Manual (name):

[ X ] Worksheet and excerpts attached

as Schedule ___

RCN estimate

$

Contractors:

Name and Address

RCN Estimate

$

RCN conclusion and rationale:

Subtotal:

$

Extras (state source):

(not included in above RCN estimate)

Attached deck/patio

$

Porches

$

Attached garage/car port

$

Basement finish

$

$

$

$

Subtotal:

$

Total Reproduction Cost New of Building(s)

$

Site Improvements: (see BUSI 330.9)

Item

Cost New

Age/Life

Depreciated Value

$

/

$

$

/

$

$

/

$

$

/

$

$

/

$

$

/

$

$

/

$

Total Depreciated Value of Site Improvements

$

Page of pages

COST APPROACH – DEPRECIATION

Age-Life Method

Item

RCN

Effective Age

Economic Life

% Dep.

Accrued Depreciation

Total

$

$

Description of process applied and justification of estimate:

Page of pages

COST APPROACH – SUMMARY

REPRODUCTION COST NEW

$

Less Total Depreciation

$

DEPRECIATED COST OF BUILDING(S)

$

Plus Depreciated Site Improvements

$

Plus Site Value

$

VALUE INDICATED BY COST APPROACH

$

Rounded to:

$

Cost Approach Conclusion: Market Value =
$

Page of pages

DIRECT COMPARISON APPROACH

Data Comparison Chart

Item

Subject Property

Comparable No. 4

Comparable No. 5

Comparable No. 6

Address

Legal description

Sale date

Instrument no.

Registration date

Vendor

Purchaser

Sale Price

Rights conveyed

Fee Simple

Financing

Conditions of sale

Expenses made immediately after purchase

Time difference (mos.)

0

Distance from subject (blocks)

0

Location

Bldg size (above grade)

Type/Quality Construction

Energy efficiency

Design and appeal

Age

Condition

Room Count

Ttl

Bds

Bth

Ttl

Bds

Bth

Ttl

Bds

Bth

Ttl

Bds

Bth

Basement unfinished area

Basement/finished below grade area

Air conditioning

Heating

Fireplace

Appliances

Lot size

Zoning

Garage/carport

Local Improvement Charges

Other comments:

Page of pages

DIRECT COMPARISON APPROACH (continued)

Adjustment Chart

Item

Comparable no. 4

Comparable no. 5

Comparable no. 6

Sale price

Real property rights conveyed adjustment

Adjusted price

Financing adjustment

Conditions of sale adjustment

Expenses made immediately after purchase adjustment

Adjusted price

Date of sale adjustment

Adjusted price

Other adjustments as required:

- Location

- Building size

- Construction

- Energy efficiency

- Design and appeal

- Age

- Condition

- Room count

- Basement unfinished area

- Basement/finished below grade area

- Air conditioning

- Heating

- Fireplace

- Appliances

- Lot size

- Zoning

- Garage/carport

- Local Improvement Charges

-

-

-

Total Other Adjustments

Final Adjusted Sale Price

For reconciliation purposes:

Total Adjustment

Total adjustment as % of Sale Price

Page of pages

DIRECT COMPARISON APPROACH (continued)

Adjustment Analysis in Order: 1. Property Rights 2. Financing 3. Motivation 4. Expenses made immediately after purchase 5. Time 6. Other

Page of pages

DIRECT COMPARISON APPROACH (continued)

Adjustment Analysis (continued)

Other adjustments

Page of pages

DIRECT COMPARISON APPROACH (continued)

Reconciliation

Direct Comparison Approach Conclusion: $
Page of pages

RECONCILIATION OF VALUE INDICATIONS AND FINAL ESTIMATE OF VALUE

Indicated value by Cost Approach

$

Indicated value by Direct Comparison Approach

$

The Market Value, as defined, for the subject property as of

(Date)

is estimated to be

$

The exposure time for the subject property has been estimated at .

Page of pages

CERTIFICATION

I certify that, to the best of my knowledge and belief:

· the reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the code of Professional Ethics and the Standards of Professional Appraisal Practice.

· the statements of fact contained in this report are true and correct.

· the reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, unbiased professional analyses, opinions, and conclusions.

· I have no present or prospective interest in the property that is the subject of this report, and I have no personal interest or bias with respect to the parties involved.

· my compensation is not contingent upon the reporting of a predetermined value or direction in value that favours the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event.

· I have made a personal inspection of the property that is the subject of this report, located at , on .

· no one provided significant professional assistance to the person signing this report.

· the final estimate of market value, as of is estimated to be:

(Date)

($ )

Signature of Student

Date Signed

BUSI 330.1