FAQ's
» What should I look for in an Appraiser?
» What is an appraisal?
» What is the International Society of Appraisers?
» What is considered Personal Property?
» Identification vs. Authentication.
» What are the Uniform Standards of Professional Appraisal Practice (USPAP)?
» How do you determine value?
» What is present worth?
» What types of Values are used?
» What is the Fee basis?
What should I look for in an Appraiser?
There is currently no legal certification or licensing required of personal property appraisers, and there is no government testing or standards for the profession. Find an appraiser who has established expertise and who has had professional training in appraisal principles, theory, ethics, law, and procedures.
What is an appraisal?
An appraisal is the act or process of determining value, estimating cost, or determining the present worth of forecasted earnings. It is also the act, or written result, of forming a non-monetary opinion or recommendation regarding a property. They are opinions based on an informed judgment; that is, appraisals are supported by facts.
They are two main types of appraisals:
- Verbal Approximation of Value-the appraiser gives the client a verbal opinion of what the property may be worth, yet it is not considered a valid appraisal.
- Written Report-the appraiser forms a fully documented appraisal which can be used for a variety of situations including, but not limited to: insurance, charitable contributions, divorce, bankruptcy, equitable distribution, and moving or damage claims.
What is the International Society of Appraisers (ISA)?
The International Society of Appraisers (ISA) offers a comprehensive professional development program designed to build and enhance performance in the area of personal property appraisal practice as well as specialty studies. There are four main divisions which are comprised of antiques and residential contents; fine art; gemstones and jewelry; and machinery and equipment.
The society's professional development and credentialing programs, along with its strong code of ethics and professional conduct, serve as the foundation for the organizational mission - to advance the professionalism and effectiveness of personal property appraisers.
ISA is a not-for-profit, member-driven society, formed to support our member needs and serve the public by producing highly qualified and ethical appraisers who are recognized authorities in professional personal property appraising. Its members include many of the country's most respected independent appraisers, consultants, estate liquidators, auctioneers, gallery owners, and dealers.
What is considered Personal Property?
Personal Property is property that is moveable and that is not considered real property-(land and any improvements affixed thereto).
Identification vs. Authentication
Identificationis the scientific determination of quantitative or intrinsic elements. In other words it means to determine a property’s nature, using its origin or definitive characteristics.
Authentication is the scholarly determination of qualitative or extrinsic opinions. It means to prove or verify that an item is genuine or has an undisputed origin.
What are the Uniform Standards of Professional Appraisal Practice (USPAP)?
The Uniform Standards of Professional Appraisal Practice is a comprehensive set of standards that provide the appraiser with a guideline for performing professional appraisals, appraisal reviews, and consulting assignments. USPAP provides the rules and methodology to guide the professional appraiser in a diligent and competent manner of practice.
How do you determine value?
There are 3 approaches used in determining the value of personal property:
- Sales Comparison Approach-valuation which involves comparison of the property with similar items that have sold within the market in order to derive an indication of the most probable value
- Cost Approach-compares the item being appraised with the cost to replace the item or to reproduce the item.
- Income Approach-(used only for investment property) involves the comparison with the income producing record of similar property and the application of present worth formulas to determine present worth.
What is Present Worth?
Present worth is an accounting term which represents the current amount, in terms of dollars, that would be the equivalent of income generated by the sale of property at some point in the future or the stream of income generated by leasing property for a specified amount of time.
What types of Value are used?
- Fair Market Value- Fair market value is defined by the Income Tax Regulations 1.170-1 © as “The price at which the property would change hands between a willing buyer and a willing seller, neither being under compulsion to buy or sell and both having reasonable knowledge of all relevant facts.” The fair market value is not determined by a forced sale, nor is the fair market value being determined by a sale within a marketplace other than that in which the item would most commonly be sold to the public, i.e. the end-user, taking into consideration the location of the items whenever possible.
- Replacement Cost-the cost necessary to replace an item with a new item of like kind, quality, and utility, or the cost necessary to replace an item with an equivalent item having similar appearance, quality, condition, age, authorship and utility.
- Liquidation Value-
- Forced: the price at which property would change hands if sold immediately without considering marketplace.
- Orderly: the price for which property would change hands between a knowledgeable seller and buyer.
- Salvage Value-the amount that could most probably be obtained by dividing the property into its component parts and selling them separately.
- Scrap Value-like salvage value, but neither the component parts nor the original property would have any value other than the materials from which they were created.
What is the Fee basis?
Fees are based on an hourly rate and are in no way determined by the appraised value. Please contact us for fees regarding your service.
Office Address: S/W Corner of Mission & Ocean . Suite 203 . Carmel, CA 93921
Mailing Address: P.O. Box 5021 . Carmel, CA 93921
Phone: 831.917.5006 Fax: 831.624.3220
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