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Wyoming
Chapter of ASFMRA
The Wyoming Chapter
of the ASFMRA stands for, promotes and represents the same professional
standards & ethics and strives for the same ideals as the national
organization. The members work daily with our citizens on a grass
roots level, bringing them the dependable and reliable service
they expect and deserve from a professional organization.
Appraisals of agricultural enterprises and rural properties demand
a qualified expert who understands the complexity and intricacy
of modern agriculture and today's rural environment. Rural appraises
are trained to render an accurate opinion of value, whether it
be the family farm, a rural recreational property or a major national
agribusiness property.
Rural appraisers are educated through the ASFMRA are prepared
to provide a sophisticated analysis of the land; can explore soil
type, water quality and availability; crop potential and other
key ingredients to establish value for that particular piece of
land; and have a network of colleagues around the country qualified
to provide expert appraisal opinions on everything from agricultural
land to grain elevators, feed lots and farm supply dealerships.
Their areas of expertise might be natural resources, condemnation,
partial interests, business and/or personal property valuations,
and/or complex properties such as permanent plantings, processing
facilities, transitional or recreational properties, etc. The
comprehensive appraisals prepared by a well educated rural appraiser
for clients such as lending institutions, governmental agencies,
attorneys, CPA's, and private individuals or businesses, is an
assurance of a superior evaluation for agricultural enterprises
and rural properties.
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- Buyers and sellers
needing an opinion of market value.
- Mortgage loan purposes.
- Banks and other
trustees handling rural real estate belonging to others.
- Attorneys handling
cases where the value of rural property is involved.
- Owners of rural
lands involved in; eminent domain takings (by negotiation or condemnation);
inheritance, estate, gift or real estate questions; partition or division
of land ownership; litigation, concerning land valuation; the process
of incorporating their holdings.
- Anyone, who for
purpose, needs an accurate measurement of the value of rural real estate.
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What is an appraisal?
An appraisal is defined
as an opinion of value by professional appraisal standards (Uniform Standards
of Professional Appraisal Practice, see below). Appraisers consider appraising
to be both an art and a science. You probably have an opinion of the value
of your home or property. Your opinion and a professional appraiser's opinion
may be the same. But appraisers are required to be objective and impartial
in their analyses and opinions.
A professional appraiser has been trained in appraisal methodology and
looks at how your property compares with sales and listings of real estate
similar to yours. Appraisers consider many factors such as price trends,
amenities, proximity to schools, business districts, freeways, recreational
benefits, etc. and prepares a report reflecting the opinions, analysis
and conclusions arrived at during the process.
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What is
an appraiser?
An appraiser is a real estate professional who specializes
in providing opinions of value (appraisals). Most appraisers are real
estate appraisers, who specialize in real property. Other appraisers specialize
in other types of property, such as gems or machinery and equipment. Professional
appraisers have taken courses and been supervised during their training
period. State licensed and certified appraisers must pass a test and have
completed basic education and continuing education. Most states also require
a period of supervision, usually 2,000+ hours before being able to do
appraisals "on their own."
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What do appraisers do?
The property inspection is really the "tip of the iceberg"
of the work they do. They research public record information, get a plat
map, check the zoning, flood data and research sales and listings of similar
properties. During the inspection, they make a drawing of the dwellings
and other improvements such as a garages, barns, shops, sheds, etc.. They
make notes on physical characteristics such as the quality and condition
of buildings and the materials, check the site boundaries against a plat
map and look at the adjacent properties.
They
select comparable sales and/or listings and take photos of them, contact
real estate agents for more information on the sales terms, condition
of the properties, etc., reconcile conflicting information from different
data sources, and write up the report. Total time? About 6-8 hours on
average for a house, in a metropolitan area where data is computerized
and plentiful. Appraisers working in rural areas or with less data availability
will take longer to complete an appraisal.
Appraisals
of income producing property such as rental units, commercial buildings,
farms or ranches are much more time consuming as more research and analysis
is required. The time can vary from a few days on a small apartment building
to many weeks for a large, complex property.
For many
years, the appraisal process has been seen by many as mysterious. This
is partly the fault of appraisers, as we have not informed the public
of what we really do.
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Appraisers
and lenders - What is the appraiser's role?
Most appraisals are done for mortgage lenders. Most appraisers
work for lenders, particularly if they specialize in appraising real estate.
The appraiser's role is to provide an objective, unbiased opinion of value
"market value" to the lender. Appraisers work for the lenders, not the
owners, buyers, or sellers, even if one of them pays for the appraisal
by writing a check to the appraiser. Federal banking regulations require
that the lender order the appraisal. This was a result of regulations
coming from the Savings and Loan scandals in the late 1980s.
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What
is Market Value?
Market value is defined in The Dictionary of Real Estate
Appraisal, third edition and clarified by the Appraisal Institute in June
1992 as:
The
most probable price which a specified interest in real property is likely
to bring under all of the following conditions:
- Consummation
of a sale occurs as of a specified date.
- An open and competitive
market exists for the property interest appraised.
- The buyer and
seller are each acting prudently and knowledgeably.
- The price is
not affected by undue stimulus.
- The buyer and
seller are typically motivated.
- Both parties
are acting in what they consider their best interest.
- Marketing efforts
were adequate and a reasonable time was allowed for exposure in the
open market.
- Payment was made
in cash in U.S. dollars or in terms of financial arrangements comparable
thereto.
- The price represents
the normal consideration for the property sold, unaffected by special
or creative financing or sales concessions granted by anyone associated
with the sale.
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What
does the appraiser need from me?
No one knows your property as well as you! Make a list
of all the special features, such as a remodeling of buildings, soil types,
irrigated acres & water rights, production records, etc., or at least
tell the appraiser about them. Let the appraiser know if a nearby property
was listed and sold, as sometimes sales don't show up on the local MLS
or other data sources.
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Can
the appraisal be used for another lender?
Sometimes appraisals can be used for another lender. The
original lender must release the appraisal for use with a new lender.
Also, the appraisal must be relatively recent, typically no more than
6 months old.
Who "owns" the appraisal?
The appraisal is "owned" by the client who ordered it (engaged
the appraiser). If a lender ordered it, the lender owns it, even if you
paid for it. If you ordered it for non-lending purposes, you own it.
Who
gets the appraisal report?
By federal law, you are entitled to receive a copy of the
appraisal from your lender. Unfortunately, appraisers are not permitted
to provide you a copy of the appraisal.
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