Home: Tag : feasibilitystudies

The sales comparison approach is the most intuitive and best understood of the three approaches to value. Home buyers, companies renting office space and real estate investors all utilize this approach. Comparable sales are often referred to as comps and rental comparables are often referred to as rent comps.

Feasibility studies are a combination of a market study and financial analysis used to determine if it is financially feasible to develop a proposed property.

The income approach is often given primary emphasis when appraising a commercial real estate used to generate income. Estimates of value via the income approach are highly sensitive to changes in revenue, expense and capitalization rates.

Business personal property (BPP) can be challenging to value because of the limited quantity of data available and primary reliance upon the sales comparison approach. Relatively speaking, a voluminous quantity of data is available when valuing real estate as opposed to valuing business personal property.

Feasibility studies are a combination of a market study and financial analysis used to determine if it is financially feasible to develop a proposed property.

The cost approach was historically prepared as a part of most commercial real estate appraisals. However, the compunction to include the cost approach (when it was not relevant) has dissipated over the last 20 years.