Scope of Work

The USPAP (Uniform Standards of Professional Appraisal Practice) has always required that real estate appraisers show the scope of work required for credible results. But in recent years, it was found that appraisers did not fully understand this process, so USPAP was updated in 2006 with a new scope of work rule. The rule requires that the minimum standards for scope of work are a) expectations of the client and other users, and b) the actions of other appraisers who carry out similar assignments. The rule also states that appraisers need to identify six components of the appraisal before the actual appraisal begins:

• The client requesting the appraisal
• The intended use of the appraisal report
• The value (market, foreclosure, investment)
• Any hypothetical conditions or assumptions
• The date of the appraisal report
• The relevant features of the property

Using these components, the appraiser identifies the scope of work.

The scope of work is the first step in any appraisal. Without a specific scope of work, the conclusions of an appraisal may not be viable. By defining the scope of work, an appraiser can develop a value for a property, which is the intended use of the appraisal.

By: Present Value

Tags: scope of work, USPAP

This entry was posted on Thursday, October 22nd, 2009 at 6:59 pm and is filed under Real Estate Appraisal. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.