Glossary of Terms


In real estate appraisal terminology, "above grade" refers to the portion of a building or structure that is above ground level. It typically includes all floors or levels of a building that are not below the ground or basement level.

When conducting an appraisal, appraisers often distinguish between above-grade and below-grade areas of a property because these areas can have different values and characteristics. Above-grade square footage is generally considered more desirable and valuable than below-grade square footage because it typically includes living spaces, bedrooms, kitchens and other areas that are more commonly used and preferred by occupants.

Appraisers take into account the size, layout, condition and quality of above-grade areas when determining the value of a property. They may also compare the above-grade square footage of the subject property to similar properties in the area to assess its market value accurately.

A measure of land, 1-acre = 43,560 square feet. Typically, values below 1 acre are given in square feet, above 1 acre values are in acres.

Just enough to meet some requirement or purpose.

A calculation that is added or subtracted to a comp for a feature that differs from the subject. An adjustment places a value on the particular feature that differs from the subject. Adding or subtracting this value would then bring all comps in line with similar values, which will in turn lend more support to the subject’s suggested value.

Accessory Dwelling Unit. A self-contained, smaller living unit on the lot of a single family home.

See appraiser. Not to be confused with real estate agent.

Determining the essential features of a report and their relations to one another. It is essential for report analysis to defend your observations about these features with evidence, mostly in the form of relevant comps.

A real estate appraisal is the process of determining the value of a property, typically conducted by a professional known as an appraiser. Appraisals are crucial in various real estate transactions, including buying, selling, financing and refinancing properties. During an appraisal, the appraiser conducts a thorough examination of the property, considering factors such as its location, size, condition, age, amenities and comparable sales in the area. They also take into account market trends, economic conditions and zoning regulations that may affect the property's value. Once the appraisal is complete, the appraiser provides a detailed report outlining their assessment of the property's value, usually based on one of three common approaches:

  1. Sales Comparison Approach: This method involves comparing the subject property to similar properties that have recently sold in the same area. Adjustments are made for differences in characteristics to arrive at an estimated value.
  2. Cost Approach: This approach determines the value of the property by estimating the cost to replace it with a similar one, accounting for depreciation and obsolescence.
  3. Income Approach: Mainly used for income-producing properties such as rental apartments or commercial buildings, this approach assesses the property's value based on its potential income generation.
Real estate appraisals play a critical role in ensuring fair and accurate property valuations, providing valuable information to buyers, sellers, lenders and other stakeholders in real estate transactions. They help mitigate risks for lenders, ensure buyers pay a fair price, and assist sellers in setting realistic asking prices.

Date upon which the official appraisal is conducted

The Appraiser Independence Requirements (AIR) were developed by Freddie Mac, the Federal Housing Finance Agency (FHFA), Fannie Mae and key industry participants. These requirements provide important protections for mortgage investors, home buyers and the housing market. More information can be reviewed here:  

An Appraisal Management Company (AMC) is a business entity that acts as an intermediary between appraisers and lenders, facilitating the appraisal process in real estate transactions. AMCs are commonly used by lenders, mortgage brokers and other financial institutions to manage the ordering, assignment and quality control of property appraisals.

Stewart Valuation Intelligence is an Appraisal Management Company. Learn more about the role of an AMC in the mortgage process here.

The value of the property determined by the appraiser

A person who has the knowledge and expertise necessary to estimate the value of a property. An appraiser acts independently of the buying and selling parties in a transaction in order to arrive at their fair value of an asset without bias.

Aka arm’s length sale. A transaction in which both buyer and seller act willingly, independently and in their own self-interest.

The value of the property as it is, with no repairs made

Aka assessed value. The dollar value assigned to a property for purposes of measuring applicable taxes. Assessed valuation is used to determine the value of a residence for tax purposes and takes comparable home sales and inspections into consideration.

An Assessor Parcel Number (APN) is a unique identifier assigned to each parcel of land by a local government's assessor's office or tax assessor's office. APNs are used primarily for property tax assessment purposes and help government agencies and other entities track and manage properties within their jurisdiction. The APN system provides a standardized method for identifying and referencing individual parcels of land, making it easier for assessors to assess property taxes, track ownership changes and maintain property records. Each APN typically consists of a series of numerical digits that uniquely identify the parcel, although the exact format may vary depending on the locality. APNs are commonly used in real estate transactions, property tax assessments, zoning and land use planning, and other administrative processes related to land ownership and management. They are essential for accurately identifying and managing properties within a jurisdiction and are often included on property tax bills deeds, and other legal documents related to real estate.

An examination and verification of a report

A person qualified to audit

An automated valuation model (AVM) is a mathematical model used to assess the value of real estate properties. It provides property valuations by analyzing various factors such as property characteristics, historical sales data, market trends and other relevant information. AVMs are often employed by banks, mortgage lenders, real estate professionals and property appraisers to quickly estimate the value of a property without the need for a traditional appraisal conducted by a human appraiser. These models can help streamline processes, save time and reduce costs in real estate transactions. However, it's important to note that AVMs may not always provide accurate valuations, especially in unique or rapidly changing markets, so they are often used as a supplement to, rather than a replacement for, traditional appraisals.


A Broker Price Opinion (BPO) is an estimate of a property’s anticipated sale price as determined by a real estate broker or agent. It is often requested by financial institutions, mortgage companies or other entities that need to assess the market value of a property. BPOs are commonly used in situations where a full appraisal may not be necessary or practical. Real estate brokers/agents with knowledge of the local market perform BPOs by visiting a property, taking pictures, then evaluating the property considering factors such as its condition, location, comparable sales in the area and current market trends. BPOs are typically less expensive and quicker to obtain than a full appraisal, making them a cost-effective option in certain situations. It is important to note that BPOs may not be as comprehensive as a formal appraisal and are not accepted in all situations, depending on regulations and the specific requirements of the requesting party.


A Core Based Statistical Area in a U.S. geographic area defined by the Office of Management and Budget (OMB) based around an urban center of at least 10,000 people and adjacent areas that are socioeconomically tied to the urban center by commuting.

Contract Date

Allow appraisal of one-to-four residential units without regard to value or complexity.

Banks and lenders who contract SVI to complete an order

The final step in executing a real estate transaction. The closing date is set during the negotiation phase, and is usually several weeks after the offer is formally accepted. On the closing date, the parties consummate the purchase contract, and ownership of the property is transferred to the buyer. Aka settlement.

Comparative Market Analysis. An informal opinion of a property’s price but done either for sellers to determine at what price they should list their property or for buyers to help them determine what price to offer. C.f. BPO

Additional sales provided in the CMA

MLS sheets for the CMA alternate sales

A format that provides statistical data [low and high price range, average, etc.], a list of comparable properties with a prief description of the property characteristics [room count, site size, gla, year built, list date, list price, sold date, sale price, DOM, etc].

Close of Escrow. Close of escrow means essentially that a real estate transaction has been completed and that the sale is final. An ‘escrow’ is a common feature of transactions. It is an independent third party that holds all monetary funds and documents until the close of sale. The seller of the property transfers all documents to the escrow agent, who holds them until the buyer transfers the money for sale to the agent who ultimately transfers it to the seller. Once this is done, it completes the transaction and is know as the closing of escrow, or often just “the closing.”

Additional information required to justify methods used in valuation

Often shortened to "comp". Properties that are substantially equivalent to the subject property. Comps express estimate of value for the subject property. Normally, such properties have been recently sold or leased and are similar to the property being evaluated. Comparables need not be identical to the subject, but should be similar or relatively easy to adjust for differences in comparison.

Properties similar to the subject that have recently sold. They are used to determine the value of the subject property.

A benefit or discount to help close a deal. Concessions are usually included in the closing costs of the deal.

A summing up of the points and a statement of opinion or decisions reached. This statement of opinion is the main difference between a summary and a conclusion. A single paragraph could be both, but the conclusion, which may only be one sentence, will come last, and can still be distinguished from the rest of the summary.

The absolute ownership of an apartment or a commercial unit (unit can be attached or detached), by a legal description of the airspace that the unit actually occupies, plus an undivided interest in the ownership of the common elements, jointly owned with the other condominium unit owners.

A mortgage loan made with real estate as security, that is neither insured by the FHA nor guaranteed by the VA.

A multiunit residential building with title in a trust or corporation that is owned by and operated for the benefit of persons living within it, who are the beneficial owners of the trust or the stockholders of the corporation, each possessing a proprietary lease granting occupancy of a specific unit in the building.

The process of providing an opinion of value of a property by adding the appraiser’s estimate of the reproduction or replacement cost of property improvements, less depreciation, to the estimated land value.


The date the document is signed. In an appraisal, it’s the date a report is signed by the appraiser (not to be confused with the effective date of the appraisal).

A written document that conveys title to or an interest in real estate.

A desktop appraisal, also known as a desktop valuation or desktop assessment, is a method of property valuation that is conducted without physically inspecting the property. Instead of visiting the property in person, the appraiser relies on various data sources and information to determine an estimated value.

In a desktop appraisal, the appraiser typically utilizes information such as property records, public data, comparable sales data, photographs, and sometimes even satellite imagery or virtual tours. They analyze these details and apply their expertise to assess the property's value based on the available information.

Not similar; different.

Generally refers to foreclosures and short sales, selling at discounts to facilitate a quick sale

Days on Market. The number of days a property was offered for sale and exposed to the open market, typically via the MLS.


The E & O is documentation of insurance against errors and omissions held by the appraiser.

The date upon which an appraiser’s analyses, opinions, and conclusions go into effect

See external obsolescence

Anything in and around the surrounding neighborhood, and/or the vicinity of the property that will influence the price of the property, positively or negatively. For example: airport flight path, rail road tracks


The most probable price, as of the date of inspection or other specifically defined date, which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. C.f. fair market value.

The most probable price real estate should bring in a sale occurring under normal market conditions. C.f. fair market price.

The greatest possible estate or right of ownership of real property, continuing without time limitation. c.f. leasehold

Federal Housing Administration. Insures loans made by approved lenders.

Purchase of a property with the intent to sell it for a profit.

Final List Price c.f. LP, SP

See fair market price

See fair market value

Standardized appraisal document that allows users to work seamlessly across formalized appraisal documents regardless of who prepared them

For Sale By Owner. The process of selling real estate without the representation of a real estate broker or real estate agent.

Anything in and around the property that will influence the price of the property, positively or negatively. For example: insufficient bath count relevant to bedroom count, poorly located bedrooms


Gross Building Area. All enclosed floor areas, as measured along a building's outside perimeter.

A partner has the knowledge, skills and resources needed to competently complete an assignment in accordance with the Uniform Standard of Professional Appraisal Practice (USPAP).

Gross living area is the total finished, habitable, above-grade space, measured along the building's outside perimeter.

Gross Rent Multiplier. A figure used as a multiplier of the gross income of a property to produce an estimate of the property's value.

Government-Sponsored Enterprises. For example Fannie Mae and Freddie Mac


The legally and physically possible use of land that is likely to produce the highest land (or property) value.

Home Owners Association. An organization of property owners in a residential condominium or subdivision development, usually authorized by a declaration of restrictions to establish property design and maintenance criteria, collect assessments, and manage common areas.

Department of Housing and Urban Development is a Federal agency responsible for national policy and programs that address America's housing needs, improve and develop the Nation's communities and enforce fair housing laws.


Any permanent structure on real property, or any work on the property (such as planting trees) which increases its value. Therefore for lending purposes, the value of a property has two constituents: the value of the land itself, plus the value of any improvements--the house standing on that property.

Not sufficient or unsuitable

An appraisal technique that uses a property's earning capability as calculated by the capitalization of property income to determine the overall value

The process of providing an opinion of value of an income-producing property by capitalization of the annual net operating income expected to be produced by the property during its remaining economic life.

A property bought or developed to earn income through renting, leasing or price appreciation. Income property can be residential or commercial. Residential income property is commonly referred to as "non-owner occupied."

The actual date the subject property is inspected (not to be confused with the effective date of the appraisal).


A parcel of land that has no legal right of way or access to a road

The lessor's interest and rights in the real estate being leased.

The lessee's right to possess and use real estate during the term of a lease.

A legally binding description that enables any real estate to be located and properly identified

Order information provided at time of assignment. This information is required for the partner to determine scope of work. It contains the property address, borrower, POC, fee, due date on other client or order specific instructions.

Allows appraisal of non-complex one-to four residential units having a transaction value less than $1,000,000, and complex one-to-four residential units having a transaction value less than $400,000

Properties located in the same market area/neighborhood as the subject that are currently listed for sale. They are used to determine the value of the subject property. Indicates that the property is for sale on the open market.

List Price. c.f. FLP, SP


A structure transportable in one or more sections, designed and equipped to contain not more than two dwelling units to be used with or without a foundation system.

Aka Community Facilities Act. Named after its authors, this Californian Act enabled "Community Facilities Districts" (CFDs) to be established by local government agencies as a means of obtaining community funding to pay for public works and some public services. It allowed public improvements to be funded despite local government's restriction on raising property taxes by more than inflation. The down-side is that the payments levied on affected homes are fixed, and so in some down markets they can eventually prevent buyers from qualifying for loans because the effect on debt to income ratio by the Mello-Roos addition payment to the impound/escrow account.

a measurement of distance, 1-mile = 5,280 feet.

Multiple Listing Service. The primary purpose of an MLS is to provide a facility for making an offer of cooperation and publishing a unilateral offer of compensation by a listing broker to other broker participants in that MLS. In other words, the compensation offered to a cooperating broker by the listing broker is published within the MLS to other cooperating brokers.

Where the Data Provider has provided the search parameters

Multiple separate housing units (residential) are contained within one building or several buildings (attached or detached) within one complex.


The subject market area seen as similar in marketing appeal and overall demand from a prospective buyer. This refers to a smaller, loosely defined geographical location within a larger city, town, or suburb. They often consist of social communities with considerable face-to-face interaction among their members. Neighborhoods are important because prices vary considerably in different neighborhoods.

The neighborhood boundaries define the subject market area, generally in terms of the four major landmarks to the north, south, east, and west. The neighborhood boundaries may be streets, highways, or natural or man-made features (such as an airport or river). Generally the neighborhood boundaries should encompass subject and comps; comps existing outside the boundaries require an explanation.

Aka non-arms length sale. See arms length transaction.

A once lawful property use that is permitted to continue after a zoning ordinance prohibiting it has been established for the area.


Possession and use of property as owner or tenant.

Original List Date

Original List Price

Opinion of Market Value. The appraiser's opinion of the most probable price which a property should bring in a competitive and open market.

Appraisals or Broker Price Opinions (BPO)

A formal, impartial estimate or opinion of value, usually written, of an adequately described property, as of a specific date, and supported by the presentation and analysis of relevant data. It is prepared as a result of the retainer, for reliance by identified parties, and for which the appraiser accepts responsibility. Only a state-certified appraiser can provide a certified appraisal. C.f. BPO, CMA: informal estimates.

Comparables utilized in the original appraisal report.

An improvement that is more than warranted by the property's highest and best use and thus not likely to contribute its cost to the total market value of the property. c.f. under-improvement


The appraisers and agents/brokers that we contract to complete orders for us

Purchase Contract (more commonly Purchase and Sales)

"Wear and tear on the improvements - includes deferred maintenance (items needing immediate repair), short-lived components (furnaces, hot water heaters, roof, carpet, etc.), and long-lived components."

Property Identification Number, see APN.

A subdivision consisting of individually owned residential and/or commercial parcels or lots as well as areas owned in common.

The POC is the person that must be contacted by the partner to schedule an interior inspection

The document signed after a buyer and seller mutually agree on the price and terms of a real estate transaction


A person with a real estate license. Not to be confused with a Real Estate Broker.

Aka broker. A person who has passed a broker's license exam. A broker can work alone, or hire real estate agents to work for them. Notice therefore a broker is a more qualified position. A broker cannot assess the value of a property (you must be an appraiser for that) but as real estate professionals they have a knowledge of the local real estate market that uniquely qualifies them to perform the informal estimates required of a BPO. Not to be confused with Real Estate Agent.

A class of property owned by a lender-typically a bank, government agency, or government loan insurer-after an unsuccessful sale at a foreclosure auction.[1] A foreclosing beneficiary will typically set the opening bid at a foreclosure auction for at least the outstanding loan amount. If there are no bidders that are interested, then the beneficiary will legally repossess the property. This is commonly the case when the amount owed on the home is higher than the current market value of this foreclosure property, such as with a high loan-to-value mortgage following a real estate bubble. As soon as the beneficiary repossesses the property it is listed on their books as REO and categorized as an asset (non-performing asset).

When two or more reports on the same property differ in suggested value by more than a specified tolerance, the reconciliation process requires an appraiser to gives weight to the more reasonable report and justifies this decision with reasoned commentary.

Reconsideration of value in real estate appraisals refers to the process of reviewing and potentially adjusting the appraised value of a property. This typically occurs when there are concerns or disputes regarding the initial valuation provided by the appraiser.

Reasons for reconsideration of value can vary and may include:

  1. Errors or inaccuracies: If there are factual errors or inaccuracies in the appraisal report, such as incorrect property measurements or overlooking important features, a reconsideration may be warranted.
  2. New information: If new information becomes available that wasn't considered during the initial appraisal, such as recent comparable sales or property improvements, it may justify a reassessment of the property's value.
  3. Challenges or disputes: If the buyer, seller, or lender disagrees with the appraised value and can provide evidence to support a different valuation, a reconsideration may be requested.
  4. Regulatory compliance: Sometimes, a reconsideration of value is initiated to ensure compliance with industry regulations or lender guidelines.

More than a decade ago, Stewart Valuation Intelligence put policies in place that address ROVs as well as other items that we categorize as being part of the “Arbitration Process.” We review these policies with our clients, so they know what to do when a borrower or homeowner has questions about the appraisal process or results of an appraisal. SVI also understands that Appraisal Independence Requirements (AIR) must also be followed when these issues arise.

The number of years of useful life left to a building from the date of appraisal.

The current construction cost of a building having exactly the same utility as the subject property.

The origination appraisal, bpo or other product that is the end product generated by Pro Teck as a result of a specific client order. C.f. order, case

Date when the appraisal report is trasmitted to the client

The current construction cost of an exact duplicate of the subject building.

Real Estate Settlement and Practices Act. Requires borrowers be provided details of cost of the real estate settlement process, limits the use of escrow accounts, and bans certain practices such as kickbacks for referring services related to the settlement. CFPB Document Link

Opinion of value based on the subject's DNA, externalities & analysis/review of the CMA alt sales


A property valuation technique that compares sales of similar properties to the property being appraised

This is one of three approaches to value in appraisal theory (income and cost being the other two). In this approach, value is based on a comparative analysis of recent sales prices of similar properties, after making adjustments for seller concession, time, and other differences in the properties.

The actual price that a buyer pays for a property. c.f. LP, FLP

Defined values for delivery schedule (turn-around time) for a specific client and report type. Internal reporting tracks how well our actual values compare to this defined tolerance, and future case volume often depends on how these statistics rank in comparison to our competitors.

Aka Liquidation: A type of RMV that is specifically for liquidation or short sale purposes. The most recent product in an SPO RMV will always be an interior valuation product. Most SPOs include a purchase offer which needs to be reviewed and commented on in the RMV.

A short sale is defined as a transaction where title transfers, where the sales price is insufficient to pay the total of all liens and costs of sale, and where the seller does not bring sufficient liquid assets to the closing to cure all deficiencies. Short sale values are typically sold at a lesser value than average market value (if short sales are not typical market value), meaning the partner is taking a loss in sale value from. This typically means the seller's principal is greater than sales price or (current market value), providing the partner with a negative balance on property sale. Short sales are done to avoid the seller/partner going through a foreclosure process.

The date the report is signed

Having a likeness or resemblance, especially in a general way: two similar houses

A dwelling designed for occupancy by one family

Subject Matter Expert

The date a property sold, close of escrow.

Suggested Sale Price

A group of houses created by the same builder or in the same general area

The property being valued by the appraiser or agent/broker

The value of the property if repairs are made

A comprehensive but brief restatement of the most important of previously stated facts or observations. It is more important to be comprehensive than brief. c.f. conclusion

The process of measuring land to determine its size, location and physical description or a map showing the results of a survey.


The time between receiving the order and submitting the order agreed upon by partner at time of assignment


The GSEs developed the Uniform Collateral Data Portal® (UCDP®), which is a single portal for the electronic submission of appraisal data. Lenders are required to use the UCDP to deliver electronic appraisal data that conforms to the UAD before the delivery date of the mortgage loan to Fannie Mae or Freddie Mac. This requirement applies to all conventional mortgage loans for which an appraisal report is required.

An improvement that is less than a property's highest and best use. c.f. over-improvement

To improve the quality and consistency of appraisal data for loans delivered to the government-sponsored enterprises (GSES), Fannie Mae and Freddie Mac, at the direction of the Federal Housing Finance Agency (FHFA), developed the Uniform Appraisal Dataset (UAD), which defines all fields required for an appraisal submission for specific appraisal forms and standardizes definitions and responses for a key subset of fields.

Uniform Residential Appraisal Report (form 1004). A single family appraisal form designed to report an appraisal of a one-unit property or a one-unit property with an accessory unit, including a unit in a PUD.

Uniform Standards of Professional Appraisal Practice. Rules and standards for ethical and performance obligations of appraisers established to promote and maintain a high level of public trust in appraisal practice.


A mortgage loan on approved property made to a qualified veteran by an authorized lender and guaranteed by the Department of Veterans Affairs to limit possible loss by the lender.


Municipal or county regulation of land use within designated districts or zones.

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