What are the Two Types of Appraisal Report?

Published by Merryl Dusaran on

The Types and Uses of Appraisal Reports

The Uniform Standards of Professional Appraisal Practice (USPAP), is the recognized ethical and performance standards for the appraisal profession in the United States. It’s also the guidelines that rule the creation and distribution of appraisal reports.

There are two types of appraisal reports addressed by USPAP as of 2014, namely Appraisal Report and Restricted Appraisal Report. These are the only reports endorsed to meet USPAP’s minimum requirements and reporting standards.

In other words, each written report of real estate appraisal must be prepared and submitted as one of these two types of reports. While both reports are completed appraisals with certified values, they vary particularly on the content and level of reporting detail, as they are dependent on the intended use and the intended user.

The Restricted Appraisal Report  

A Restricted Appraisal Report is the least common type of property valuation report because it contains minimal content, and the intended user is only the client, and no other third parties. The content of the Restricted Appraisal report must be appropriate for the intended use of the appraisal and, at a minimum:

  1. State the identity of the client; if the client has requested anonymity, state that the identity is withheld at client’s requests. but it is retained in the appraiser’s work file.
  2. State the identity of any other intended user(s) by name.
  3. Clearly and conspicuously state a restriction that limits the use of the report to the client and the named intended user(s).
  4. Clearly and conspicuously warn that the report may not contain a supporting rationale for all of the opinions and conclusions set forth in the  report.
  5. State the intended use of the appraisal.      
  6. State information sufficient to identify the real estate involved in the appraisal.      
  7. State the real property interest appraised.      
  8. State the type of value and cite the source of its definition.      
  9. State the effective date of the appraisal and the date of the report.      
  10. State the scope of work used to develop the appraisal.
  11. State the extent of any significant real property appraisal assistance.
  12. Provide sufficient information to indicate that the appraiser complied with the requirements of Standard 1 by a.) stating  the appraisal methods and techniques employed, b) stating the reasons  for excluding the sales comparison, cost, or income approach(es) if any  have not been developed, c) summarizing the results of analyzing the subject sales, agreements of sales, options, and listings in accordance  with Standards Rule 1-5, and d) stating the value opinion(s) and conclusion(s).
  13. State the use of the real estate existing as of the effective date and the use of the real estate reflected in the appraisal.
  14. When an opinion of highest and best use was developed by the appraiser, state that opinion.
  15. Clearly and conspicuously:  state all extraordinary assumptions and hypothetical conditions; and  state that their use might have affected the assignment
  16. Include a signed certification in accordance with Standard Rule 2-3.

The Appraisal Report

An Appraisal Report contains much more detail in terms of scope of work and research documentation. The content of an Appraisal Report must be appropriate for the intended use of the appraisal and, at a minimum:

  1. State the identity of the client, or if the client requested anonymity, state that the identity is withheld at the client’s requests. but it is retained in the appraiser’s work file.
  2. State the identity of any intended user(s) by name or type.
  3. State the intended use of the appraisal.
  4. Contain information, document, and/or exhibits sufficient to identify the real estate involved in the appraisal, including the physical, legal, and economic property characteristics relevant to the assignment.
  5. State the real property interest appraised.
  6. State the type and definition of value and cite the source of the definition.
  7. State the effective date of the appraisal and the date of the report.
  8. Summarize the scope of work used to develop the appraisal.
  9. Summarize the extent of any significant real property appraisal assistance.
  10. Provide sufficient information to indicate that the appraiser complied with the requirements of Standard 1 by a.) stating the appraisal methods and techniques employed, b) stating the reasons for excluding the sales comparison, cost, or income approach(es) if any have not been developed, c) summarizing the results of analyzing the subject sales, agreements of sales, options, and listings in accordance with Standards Rule 1-5, d) stating the value opinion(s) and conclusion(s), and e) summarizing the information analyzed and the reasoning that supports the analyses, opinions, and conclusions, including reconciliation of the data and approaches.
  11. State the use of the real estate existing as of the effective date and the use of the real estate reflected in the appraisal.
  12. When an opinion of highest and best use was developed by the appraiser, state that opinion and summarize the support and rationale for that opinion.
  13. Clearly and conspicuously:  state all extraordinary assumptions and hypothetical conditions; and state that their use might have affected the assignment results.
  14. Include a signed certification in accordance with Standard Rule 2-3.

While the Restricted Appraisal Report states findings, the Appraisal Report, on the other hand, summarizes findings and the research purposes. The former takes less time for a real estate appraiser to develop since it only contains minimal report details, whereas the latter contains a broad scope of documentation. Nonetheless, both are pertinent for your needs depending on your intended use.


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