Effective Date

The effective date is the point in time to which an opinion of value applies. Because real estate value reflects market conditions at a particular point in time, every appraisal identifies an effective date for its value conclusion.

An appraisal may have a current, retrospective or prospective effective date. A current effective date reflects conditions at or near the time of the appraisal and is common in mortgage lending. A retrospective effective date looks backward and may be used for estate settlement, tax appeals, litigation or divorce. A prospective effective date looks forward and may apply to proposed construction or a property expected to reach stabilized occupancy.

The effective date determines which market conditions and comparable sales are relevant to the analysis. It may also affect lender requirements for how recently an appraisal must have been completed. The effective date should not be confused with the date of signature, which records when the appraiser signed the report.