Cost approach definition
Cost approach. This valuation approach estimates the value of the tangible assets only. Value is represented by the market value of the land plus the depreciated reproduction cost of all improvements and equipment. In general, the Income and Sales Comparison Approaches are considered the best representation of value because they cover both tangibles and intangible assets, consider the operating characteristics of the business and have the most significant influence on attracting potential investors. The appraised values submitted by the three appraisers shall be ranked from highest value to middle value to lowest value, the appraised value (highest or lowest) which is furthest from the middle appraised value shall be discarded, and the remaining two appraised values shall be averaged to arrive at the Fair Market Value.
Cost approach means an approach to valuing real estate that requires an appraiser to: (1) Develop an opinion of site value by an appropriate appraisal method or technique; (2) analyze comparable cost data as are available to estimate the cost new of the improvements if any; and (3) analyze comparable data as are available to estimate the difference between the cost new and the present worth of the improvements, also called accrued depreciation.
Cost approach means a method used to establish the fair
More Definitions of Cost approach
Cost approach means a method used to establish the fair cash value of property involving an estimate of current construction cost of improvements, subtracting accrued depreciation and adding the value of land;
Cost approach means a method used to establish the fair cash value of property involving an estimate of current construction cost of improvements, subtracting accrued depreciation including any loss in value that may be caused by physical deterioration,
Cost approach means one (1) of three (3) traditional approaches to value by which an indication of the value of a property is arrived at by estimating the value of the land, the replacement or reproduction cost new of the improvement, and the amount of depreciation to the improvement. The estimated land value is added to the estimated depreciated value of the improvements to arrive at an estimated property value.
Cost approach. This valuation approach estimates the value of the tangible assets only. Value is represented by the market value of the land plus the depreciated reproduction cost of all improvements and equipment.
Cost approach means the appraisal process in which cost of the property being valued is considered in determining an estimate of fair market value. As a general rule, original cost shall be used to value public utility operating property; however, when such original cost is not available, replacement cost or reproduction cost may be considered.
Cost approach. This valuation approach estimates the value of the tangible assets only. Value is represented by the market value of the
Cost approach means the determination of the value of a mortgaged real property arrived at by adding the estimated value of the land to an estimate of the current replacement cost of the improvements, and then subtracting depreciation from all sources.