What does the Adaptive Estimation Procedure (AEP) allow for?

The Adaptive Estimation Procedure (AEP) is designed to facilitate a more precise appraisal process by allowing for the separation of land and building values. This method takes into consideration the unique interactions between property characteristics and market conditions, enabling appraisers to derive individual values for land and improvements. By estimating these values separately, AEP provides a more accurate representation of the worth of a property, reflecting its component parts based on observable sales data and market trends.

In the context of the other options, estimating building values alone would not fully utilize the capabilities of AEP, as this procedure specifically emphasizes differentiation between land and building values. While the AEP may utilize sales data, it does not necessarily require extensive amounts; it effectively works with the data available to adapt estimates accordingly. Lastly, AEP’s primary focus is not on merely estimating property characteristics, but on creating precise valuations through the separation of land and building components. Thus, the correct understanding of AEP underscores its functionality in breaking down property valuations into actionable insights for both land and improvements.