The purpose of this book is to help clear up many of the misconceptions surrounding the process of extracting line-item adjustment rates. It is for residential and commercial appraisers; as well as reviewers, underwriters, enforcement bodies, analysts, and researchers, etc. It carefully considers the following questions
- Do the traditional extraction methods and techniques work?
- Are statistical analysis methods appropriate for real property valuation?
- Are appraisers performing these methods and techniques correctly?
- Are any adjustment extraction techniques available that we don’t currently know about?
These questions will lead to perhaps the most pertinent question:
- When has the due diligence, in supporting and explaining adjustments, been satisfied?
Chapter 1 covers some basic statistical techniques that are necessary to understand the concepts put forth in the later chapters. Chapter 2 introduces market modeling. It is imperative that the reader understands what a virtual market is, and the role it plays in our research. The topic of critical decision making is presented in Chapter 3. This includes both, mathematical concepts and human intuition. Several cognitive biases are introduced and discussed. Chapter 4 touches on the intricacies of the science of data management. The nature of an adjustment is discussed in Chapter 5, and it is not what you might think. The “missing mile” in the appraisal body of knowledge concerning extracting adjustment rates is identified and explained in Chapter 6 – it will absolutely blow your mind! This new information will open the door to an entirely new set of adjustment extraction techniques. In Chapter 7, several extraction methodologies are discussed. Their effectiveness, in relation to varying market types, is laid out. Chapter 8 presents several case studies allowing the reader to solidify the material covered.