About This Chapter
Cost Approach to Real Estate Valuation - Chapter Summary
It's pivotal for real estate estate agents to have a comprehensive understanding of the value of a home so they can best help their clients sell their properties at a fair and profitable price. There are several factors appraisers use to assign proper valuation to real estate. In this chapter, you'll explore some of the components of the cost approach to real estate valuation, such as:
- Procedures involved in cost approach to property valuation
- Cost information sources used for real estate valuation
- Depreciation and the cost approach
- Cost factors in valuation
We work diligently to keep the learning process engaging and effective. Our expert instructors have formulated the information in a way that's easy to comprehend and absorb, and we provide you with several methods for learning. Each lesson contains highlighted terms to help you identify important concepts. Lesson quizzes are included to help you gauge your progress. After completing the lessons, a chapter exam is available for you to test your knowledge.
1. Cost Approach to Property Valuation: Definition & Process
In this lesson, we will learn about the cost approach to valuation, a widely-used method for determining market value of real property. We will explore some of the benefits and limitations of this method. Test your knowledge afterward with a quiz.
2. Sources of Cost Information for Real Estate Valuation
This lesson examines the cost approach method of real estate valuation and the basic process involved. We will discuss standard sources for cost information and suggestions for their application.
3. Cost Components of Real Estate Valuation
This lesson will discuss the cost approach to valuation. We will learn the difference between direct and indirect costs, define entrepreneurial incentives and profits, and discuss replacement versus reproduction costs in the cost approach.
4. Depreciation & Cost Approach for Real Estate Valuation
This lesson will discuss how to calculate depreciation in the cost approach to real estate valuation. Physical curable, physical incurable, both short-lived and long-lived, and functional and external obsolescence will also be discussed.
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Other chapters within the Florida AQB Certified General Appraiser Exam: Study Guide course
- The Real Estate Market
- Real Estate Investment & Analysis
- Land Use & Regulations
- Transferring Real Property
- Land Descriptions & Surveys
- Forms of Property Ownership
- Advanced Property Ownership Issues
- Land & Site Valuation
- Sales Comparison Approach to Real Estate Valuation
- Income Approach to Real Estate Valuation
- Uniform Standards of Professional Appraisal Practice (USPAP)