What is a typical turn-around time for a commercial appraisal?
Commercial appraisals are complex and take many hours to complete. Typically, commercial appraisals take two to three weeks to complete. We do provide expedited turn around times at an additional cost.
What is an Appraisal?
An appraisal is a professional appraiser’s opinion of value. The preparation of an appraisal involves research into appropriate market areas; the assembly and analysis of information pertinent to a property; and the knowledge, experience, and professional judgment of the appraiser. Appraisals may be required for any type of property, including single-family homes, apartment buildings and condominiums, office buildings, shopping centers, industrial buildings, and land. The reasons for performing a real property appraisal are just as varied. They are usually required whenever real property is sold, mortgaged, taxed, insured, or developed. For example, appraisals are prepared for mortgage lending purposes, tax assessment and appeals of assessment, negotiation between buyers and sellers, government acquisition of private property for public use, business mergers or dissolutions, lease negotiations and more.
What is the Role of the Appraiser?
The role of the appraiser is to provide objective impartial, and unbiased opinions about the value of real property-providing assistance to those who own, manage, sell, invest in, and/or lend money on the security of real estate. Appraisers assemble a series of facts, statistics, and other information regarding the specific properties, analyse the data, and develop opinions of value. Each appraisal assignment challenges the appraiser’s ability to put analytical skills into practice, exercise sound judgment, and communicate effectively.
What is Market Value?
The most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress. Implicit in this definition are the consummation of a sale as of the specified date and the passing of title from seller to buyer under conditions whereby:
- Buyer and seller are typically motivated;
- Both parties are well informed or well advised, and acting in what they consider their own best interests;
- A reasonable time is allowed for exposure in the open market;
- Payment is made in terms of cash in Canadian 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.
What is the Highest and Best Use of a property?
The highest and best use of a property is defined as the reasonable and most probable use that will support its highest present value. The highest and best use, or most probable use, must be legally permissible, physically possible, financially feasible, and maximally productive. The highest and best use concept is based upon traditional appraisal theory and reflects the attitudes of typical buyers and sellers who recognize that value is predicated on future benefits. This theory is based upon the wealth maximization of the owner, with consideration given to community goals. A use which does not meet the needs of the public will not meet the above highest and best use criteria.
What are the approaches to value?
There are three general groups of methodologies for determining value. These are usually referred to as the “three approaches to value” which are independent of each other:
1) The Direct Comparison Approach
The basic premise of the Direct Comparison Approach is that the value of a property is the price paid for comparable properties which have recently sold. The method is to discover sales of properties which can be reasonably used to estimate subject value on a comparative basis. Since sales of properties which are exactly similar to the subject property are seldom found, it is usually necessary to apply a process of adjustment to the selling prices of properties used for comparative purposes in order to reflect the differences with the subject property.
2) The Cost Approach
The method of the Cost Approach is to add the value of the land to the depreciated replacement cost of the buildings and other site improvements. Although the estimate of land value can usually be supported by market data, the estimate of depreciation can be difficult to support, particularly in the case of older buildings. This test of value is usually utilized for special purpose properties (e.g. church, hospital, etc.), where valuation by the other recognized methods is not possible, or may be used in rising markets to serve as a check for the more reliable tests.
3) The Income Approach
This is an appropriate test for a property capable of producing rental income, since the method considers that capability. The relationship between net income and value is established by a capitalization process. Annual income is first calculated from actual rent or from a projection based on rent which the property could expect to obtain in the open market. Deductions are made for operating expenses paid for by the owner, if any. Allowances for possible losses from vacancy and for property management charges are also deducted. The resulting net income before debt service is then capitalized at an appropriate rate.
Who is a qualified real estate appraiser?
The Appraisal Institute of Canada requires its members to obtain either an AACI or CRA designation. Both designations require stringent education and experience requirements to be met and job performance to be in compliance with the Code of Ethics and Rules of Professional Practice established by the Appraisal Institute.
The AACI designation denotes fully accredited membership and indicates competence in valuing a wide range of real property.
The CRA designation denotes individuals qualified in the valuation of individual dwellings, undeveloped individual dwelling sites, and dwellings containing not more than four self-contained housing units.
All members of the Appraisal Institute of Canada are required to recertify every five years.
Why should I choose a member of the Appraisal Institute to conduct my appraisal?
A designated member of the Appraisal Institute has had years of education and training. It is their job to keep up to date with changes in market trends and laws that affect real estate values. Combining their knowledge and expertise with a thorough investigation of the property and the area, an appraiser will give you an independent, professional opinion that you can trust. By hiring an Appraisal Institute member to conduct your appraisal you will be hiring:
• someone who will provide objective judgement
• someone who has the education and training required to stand behind their value estimates
• someone who adheres to a professional set of values
• someone who carries mandatory liability insurance
Who is COA?
Central Ontario Appraisal (COA) merged with PVCI in 2013 and to this day continues to have some clients that continue to refer to us as COA. COA is a legally registered trade name of PVCI and we retain all intellectual rights associated with that name. PVCI will continue to carry on some business under that registered name.
Is PVCI associated with Ryan Realty Services Ltd.?
Yes, in August of 2013 PVCI purchased Ryan Realty Services Ltd. We are pleased to service the clients of Ryan Realty Services Ltd. throughout Durham Region and the GTA through our existing knowledgeable and experienced staff.
What is CNAREA?
CNAREA stands for the Canadian National Association of Real Estate Appraisers. It’s an organization that is similar to the Appraisal Institute of Canada in that it trains and designates members based on a set of professional standards. Members of CNAREA can attain differing levels of designations in both residential and commercial valuations. Where AIC members adhere to CUSPAP, CNAREA members adhere to USPAP. A growing organization, CNAREA is making headways in acceptance by a variety of lenders and institutional users.
What is Vertex Appraisals?
PVCI formed an alliance with Vertex Appraisals in 2017 to better serve our corporate and institutional clients with residential appraisals.