Chapter 21 – Introduction to Real Estate Appraisal

 

  • Real Estate Appraisal is an estimate of value

 

  • Information concerning real property is limited and difficult to collect since:

o Every house is different and unique

o Every portion of real property is distinct

o There is low turnover

o It is durable and lasts a long time

o Markets are local

o Externalities (what surrounds the property)

 

Real Estate Appraiser Requirements

 

 

  • Real estate appraisers are not required to be licensed
  • Anyone in BC is legally able to do appraisal work and charge a fee, even if they do not have any real estate knowledge
  • Most realtors carry out some degree of appraisal work
  • Despite the lack of licensing requirements, there are private appraisal associations such as the Real Estate Institute of B.C.
  • The appraisal industry regulates itself through these organizations
  • Codes of conduct are enforced in order to standardize appraisal practice and set professional standards
  • Legal Responsibilities

 

o Anyone can do an appraisal, but banks want someone who is accredited

o Changes to the real estate laws now effectively allow realtors to charge for appraisals

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