Valuation and Analysis: Process, Scope of Work, and Data
Problem identification first
The valuation process starts with problem identification: intended use, intended user(s), type of value, effective date, property rights, and scope of work. Scope of work is not a fixed checklist; it must be sufficient to produce credible assignment results given the intended use, complexity, and relevant property characteristics. Data selection separates general data (market, economic, demographic, governmental) from specific data (subject records, comparable sales, listings, rentals). Each data item should be screened for relevance, accuracy, and timeliness, and tied to an actual analysis rather than collected for its own sake.
Traps
Candidates confuse the effective date with the report date, treat an extraordinary assumption as a hypothetical condition, or assume a physical inspection is always required. Another trap is collecting abundant data without linking it to highest and best use or to a specific approach. Scope must be documented so a reader can see what was and was not done.
Worked example
A lender orders a refinance appraisal effective 30 days before inspection, with no interior access. If recent exterior observations, MLS data, and verified comparable sales are adequate for an atypical property, the appraiser should expand scope or decline. Rule of thumb: write the scope sentence so another appraiser could reconstruct the assignment.