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USPAP 2018-2019 Edition

© The Appraisal Foundation

35

STANDARD 5

(c) not render a mass appraisal in a careless or negligent manner.

Comment: Perfection is impossible to attain, and competence does not require perfection. However, an

appraiser must not render appraisal services in a careless or negligent manner. This Standards Rule requires

an appraiser to use due diligence and due care.

STANDARDS RULE 5-2

In developing a mass appraisal, an appraiser must:

(a) identify the client and other intended users;

54

Comment: It is the appraiser’s responsibility to identify the client and other intended users. In ad valorem

mass appraisal, the assessor, or party responsible for certification of the assessment or tax roll is required to

apply the relevant law or statute and identify the client, and other intended users (if any).

(b) identify the intended use of the appraisal;

55

Comment: An appraiser must not allow the intended use of an assignment or a client’s objectives to cause the

assignment results to be biased.

(c) identify the type and definition of value, and, if the value opinion to be developed is market value,

ascertain whether the value is to be the most probable price:

(i)

in terms of cash; or

(ii)

in terms of financial arrangements equivalent to cash; or

(iii) in such other terms as may be precisely defined; and

(iv) if the opinion of value is based on non-market financing or financing with unusual conditions or

incentives, the terms of such financing must be clearly identified and the appraiser’s opinion of their

contributions to or negative influence on value must be developed by analysis of relevant market data;

(d) identify the effective date of the appraisal;

56

(e) identify the characteristics of the properties that are relevant to the type and definition of value and

intended use,

57

including:

(i)

the group with which a property is identified according to similar market influence;

(ii)

the appropriate market area and time frame relative to the property being valued; and

(iii) their location and physical, legal, and economic characteristics;

Comment: The properties must be identified in general terms, and each individual property in the

universe must be identified, with the information on its identity stored or referenced in its property record.

When appraising proposed improvements, an appraiser must examine and have available for

future examination, plans, specifications, or other documentation sufficient to identify the extent and

character of the proposed improvements.

58

Ordinarily, proposed improvements are not appraised for ad valorem tax purposes. Appraisers,

however, are sometimes asked to provide opinions of value of proposed improvements so that

developers can estimate future property tax burdens. Sometimes units in condominiums and planned

unit developments are sold with an interest in un-built community property, the pro rata value of which,

if any, must be considered in the analysis of sales data.

54 See Advisory Opinion 36,

Identification and Disclosure of Client, Intended Use, and Intended Users.

55 See Advisory Opinion 36,

Identification and Disclosure of Client, Intended Use, and Intended Users.

56 See Advisory Opinion 34,

Retrospective and Prospective Value Opinions

.

57 See Advisory Opinion 23,

Identifying the Relevant Characteristics of the Subject Property of a Real Property Appraisal Assignment

, if applicable.

58 See Advisory Opinion 17,

Appraisals of Real Property with Proposed Improvements,

if applicable.

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