Each appraisal problem is absolutely unique. Each assignment starts by identifying intend use and users in communication with client at the time of the assignment. Intended use provides the context for the most important judgments that follow that are necessary to competently conclude problem identification. The presenting appraisal problem must be properly identified and understood in order to accept the assignment determine the scope of work. The personal property appraiser must understand what actions or decisions will be taken by the client (intended use), as well as the needs of identified intended users of the appraisal report.
Every competent general personal property appraiser must follow the all important appraisal process and begin each potential appraisal assignment by carefully communicating with potential clients in order to properly understand (identify) the appraisal problem beginning with the intended use and users. There are several critical other factors that must be identified and that become the basis of the appraisal process. Each assignment element (client, intended use, intended users (and their needs), effective date, value type and definition, relevant property characteristics and all assignment conditions) must be identified before the appraiser can determine whether or not they are competent to complete the assignment and in order to determine the scope of work (eg appraisal process) necessary to develop credible assignment results and ultimately report their analyses, opinions and conclusion meaningfully and without being misleading.
Determining the value definition that is most relevant to intended use and users allows the appraiser to take the next step in the appraisal process: to determine the appropriate market and market level to investigate. There are many market levels in which personal property is bought and sold since personal property is movable. Each market level has unique conditions that apply. The market chosen to investigate must be relevant to and meet the conditions established by the value definition most relevant to intended use and users.
Problem identification judgements require the appraiser to choose which of the three approach(es) to value are necessary and consistent with intended use and users and the value definition. Objective data gathered by investigating the appropriate and relevant market using the sales comparison approach to value guides the appraiser to select comparable sales to analyze (adjust for differences). Following the appraisal process provides for an objective, market oriented basis of support for the appraiser's value conclusions (retained in a work file).
Only after the problem has been competently identified can the appraiser determine if they have the knowledge and experience to complete the assignment competently. Only then can they proceed to determine and complete an appropriate scope of work. The general antique and personal property appraiser of household contents and rare objects must do everything necessary to develop credible assignment results. Only the appraiser can establish that their opinions, analyses and conclusions are credible, and then communicate a report that is meaningful (relevant to the problem identified). The scope of work performed is judged base on intended use and users.
The client should be able to understand the appraisal report properly and determine it is sufficient, relevant, adequate, appropriate and complete (worthy of reliance). The report cannot be misleading. A general antique and personal property appraiser must be competent with the property types, assignment type (intended use), methodology and legal and other conditions that apply.
Fortunately the Uniform Standards of Professional Appraisal Practice (USPAP) reflect and follows the appraisal process step by stem, and establishes the minimum rules and standards for all appraisers in order to protect the public (potential clients). STANDARD 7 establishes the minimum Specific Requirements of compliance for opinion development and STANDARD 8 establishes the minimum Specific Requirements of compliance for reporting assignment results.
Novotny is an AQB Certified National USPAP Instructor and has been since 2002. He was the first personal property appraiser in the USA to achieve this important certification that allows him to teach the minimum appraisal requirements, rules and standards of USPAP. More importantly it is the driving force behind every judgment he makes since USPAP follows in perfect order the appraisal process and informs the appraiser which judgements are necessary in order to comply with USPAP and thereby develop credible appraisal report opinions worthy of belief by clients and users that can be properly understood and meaningful relevant to intended use.
CALL (626) 292-2224 or E-MAIL Novotny now to find out if he is the best match to solve you valuation problem.
RELATED ADVANCED JOURNAL PUBLICATIONS BY NOVOTNY
There are often unusual assignment conditions that apply to some appraisals. For instance, sometimes property is stolen, or is totally destroyed and cannot be inspected. Such limiting conditions are very challenging for the appraiser when developing and reporting assignment results. Such assignments are a Novotny specialty. See his published article that resulted from him serving as an expert witness during the litigation of the massive La Conchita landslide of 2005 just south of Santa Barbara with over 20 plaintiffs:
Equivalent Sampling: The Valuation of Loss Claims with Limited Property Descriptions, Novotny William M., ISA AM, Journal of Advanced Appraisal Studies, Foundation for Appraisal Education, Chicago IL 2008.
To better understand the competency requirements of appraisers read this article: When Does USPAP Require a Competency Disclosure? Novotny William M., ISA AM, 2011, Journal of Advanced Appraisal Studies, Foundation for Appraisal Education, Chicago IL
It is important to understand that clients must have good reason to trust an appraiser: Find out more: Read What Makes an Appraisal Worthy of Belief? USPAP! Novotny William M., ISA AM, Journal of Advanced Appraisal Studies, Foundation for Appraisal Education, Chicago IL 2008
Click on an above link to go to a discussion of the above "Intended Use" links.
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