How many approaches to value are typically used in mass appraisal?

In mass appraisal, three principal approaches to value are typically utilized: the cost approach, the sales comparison approach, and the income approach.

The cost approach estimates value by considering the cost to replace or reproduce the property, minus depreciation. This method is particularly useful for appraising new constructions or properties that have few comparable sales.

The sales comparison approach relies on the principle of substitution, where the value of a property is determined by comparing it to similar properties that have recently sold. This approach is commonly employed in residential appraisals, as it takes market data into account, reflecting the actual buyers' and sellers' actions.

The income approach is utilized for income-producing properties, estimating value based on the income the property generates, capitalized over time. This is key for appraisers assessing commercial properties or rentals, as it reflects the economic potential of the asset.

These three approaches provide a comprehensive framework for appraising different types of properties, allowing appraisers to arrive at fair market values based on various factors and conditions in the real estate market. By employing these methods in conjunction, mass appraisers can ensure that they deliver accurate and equitable property assessments.