Appraisal under professional valuation of property implies the determination of the economic value of the property. In fact, the appraisal is aimed at estimating the value of property not as a physical object, but the ownership right and use of this right in order to obtain economic benefits. According to valuation practice, any item (tangible or intangible) that can be owned by a natural person or legal entity, and in relation to which various operations can be applied (purchase, sale, leasing, renting, mortgage), should be classified as property. Thus, the subject of appraisal can be:
| Land |
Biological Assets |
| Buildings |
Going Concern |
| Plants |
Business and Business Interest |
| Equipment and Inventory |
Intellectual Property |
| Inventory |
License and Agreements |
According to the purpose of valuation, appraiser identifies the proper type of value to be estimated. Following types of value can be distinguished in property appraisal:
| Market Value |
Liquidation Value |
| Fair Value |
Tax Value |
| Investment Value |
Insurance Value |
| Value-in-use |
Mortgage Value |
| Utilization Value |
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Taking into account the economic relationships prevailing in everyday life, legal entities and natural persons could have the need to determine the property value and it is desired that they use the appraisal service under following circumstances:
| Purchase and Sale |
Insurance |
| Financial Reporting |
Company Mergers |
| Drawing Investments |
Company Liquidation |
| Loan Collateral |
Company Restructuring |
| Asset Reevaluation |
Impairment Test |
| Fixing Property Arguments |
Purchase price allocation |
| Hereditary Succession |
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Property valuation can be critical in making strategic investment decisions and help a business make a compelling choice.