Report Writing and Appraisal Practice
Report content
An appraisal report must clearly state the intended use, intended user, scope of work, definition of value, effective date, property description, highest and best use, approaches used, and reconciliation. The report must be credible and not misleading. Trap: omitting the intended user or scope of work, which undermines credibility.
Hypothetical conditions and extraordinary assumptions
A hypothetical condition assumes something contrary to fact (e.g., completion of construction). An extraordinary assumption is a fact that, if false, changes the conclusion. Both must be clearly disclosed and reasonable for the intended use.
Workfile and recordkeeping
Maintain a workfile supporting the report for at least five years after delivery or two years after final disposition of litigation - whichever is later. Trap: assuming the report itself is the workfile.
Communication and professional practice
Understand certification, limiting conditions, exposure time, marketing time, and reconciliation. Avoid misleading graphics and unsupported conclusions. Review appraisals (Standard 3) require forming an opinion about the work of another appraiser.
Worked example
If a report is delivered January 1, 2025, and litigation concludes June 1, 2028, the workfile must be retained until June 1, 2030 (two years after final disposition, which is later than the five-year mark).
Rule of thumb
If a statement could mislead a reader, disclose it - transparency is the test of a credible report.