Real estate is considered to be land (which is fixed and unmovable) and improvements to the land (such as buildings), and fixtures (such as any permanently fixed item to the real estate; i,e elevators, air conditioning, chillers, boilers, bathroom fixtures; plumbing, electrical wiring, and the similar. Furniture and Equipment and movable objects are separately valued and not considered to be part of the real estate.
In its simplest term, an appraisal is the act or process of developing and communication an opinion of some type of value. The value provided in an appraisal is some measure of the relative economic worth of the asset, usually expressed in terms of cash or cash equivalent. In other words, the appraiser, based on education, experience and what is known to “the best appraisal practices” as of the date of the appraisal, quantifies to a certain level of precision (or in the opposite reduces to a certain level the uncertainty) associated with what typical buyers and sellers in the market place would consider to be the relative worth of the asset for exchange purposes, if the value sought is market value.
Real property includes the interests, benefits, and rights inherent in the ownership of real estate. In an appraisal, a particular set of real property interests, and not the property itself, is what is valued. Real property in itself has no value, The rights, or interests; i.e., “bundle of rights” in the real estate is what has economic value. Real estate is considered to be immobile and tangible.
In the United States and its Territories, licensed and certified appraisers meeting the educational and experience requirements by the Appraisal Qualifications Board (AQB) of the Appraisal Foundation, are required by law and applicable regulations, in order to perform real estate appraisals.
In order to value or appraise a real estate property interest, the appraiser must hold a valid real estate appraiser license (Evaluador Profesional Autorizado, or EPA) issued under Law No. 277 of July 14, 1974, as amended, by the “Junta Examinadora de Evaluadores Profesionales de Bienes Raíces de Puerto Rico”. Additionally, if there is a federal interest involved such as mortgage financing, and any other federal other interest, a Residential Certified Appraiser (RCA), or General Appraiser Certification (GCA) is required under Title XI of the Financial Institutions Recovery and Enforcement Act of 1989, known as FIRREA. Real estate appraisers are federally and locally regulated.
We at Puerto Rico Appraisers & ConsultantsTM have Licensed and Certified General appraisers. All our appraisals are prepared in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP), and in particular with Standards 1 & 2 applicable to real estate property.
For free consultation, call on us at Puerto Rico Appraisers & ConsultantsTM, or visit our website at PuertoRicoAppraisers.com for your real estate appraisal needs!