1st Reading - Jersey City

Portion ofPJP Landfill Site, Jersey City New JáseyThe, Appraisal ProcessThe appraisal process isa systematic procedure used to ansWer questions aboutreal property value. The process involves a series of steps that, when completed,lead to a well-supported and persuasive opinion of a property's' value,The first step in the valuation process is the definition of the appraisal problem,which includes identification of the real estate and property rights tobe valued,specification .of the use of the appraisal, definitionof the value sought,specification of the date qf the value estimate, description of the scope of theappraisal, arid identification of other limiting conditions. 'Next, a preliminary'analysis is performed to determine the character and scope ofthe assignment and the amount of work that wil be required to gather the 'necessary data.During the selection and collection of data phase of the appraisal process, theappraiser gathers general data on the value influences and trends;specific datapertaining to the subject property's financing, cost, inèome and expenses, andlegal, physical, and locational features; and competitive supply and demand qata ,that describe the position of the subject property in its futlire market." ,After all of the pertinent data has been collected" a highest' and best use analysis isperformed. That is, the use that wil embody the most profitable use of the subjectsitè, as if vacant, is identified and then compared to the site as currently improved.Sy comparing the highest and best use of the site as if vacant with the property asimproved, important observations can be made regarding the property's level ofphysical, functional, and economic obsolescence. ')Once all the factual datahas been reported and analyzed, and the property's, highest and best use has been determined, ~alue estimates for the subject propertyare possible, First, a land value estimate is made to identify the site's contributionto the total pr,operty value. Next, the three approaches to value, namely, the costapproach, the sales comparison approach, and the income capitalization approachare used to provide independentindications ofthe subject property's overall value.'The value indications derived by the three approaches are then recOnciled toprovide a single valueestimate for the subject property. 'How the appraisal process is applied in this case is outlined in the next sectionunder the heading Scope of the AppraisaL. ,VALUE RESEARCH GROUP, LLC 6