An appraisal is an evaluation or assessment of the current value of a business, property, artwork, antique, or collectible item. The appraiser usually makes an assessment of the fair market value of the subject being appraised. A legitimate and accurate appraisal must be made by an expert with appropriate credentials to evaluate the subject.
An appraisal may also be an examination of a person, especially someone in public life. In this case, the appraiser will evaluate this person‘s credentials, qualities, actions, statements, success or capabilities. Politicians and public figures are often the subjects of journalists’ appraisals.
Any valid appraisal must be objective and conducted by someone with experience and knowledge concerning the subject. In the field of psychology, an appraisal may be a cognitive evaluation of the nature, significance, or consequences of a phenomenon, an action, or an event.
How Can You Trust an Appraiser?
There is no license for personal property appraisers as there is with real estate appraising. Yet, any appraiser advertising as a professional should have taken the Uniform Standards in Professional Appraisal Practice (USPAP) course during the last 24 months. The Appraisal Foundation has set the USPAP as professional guidelines for appraisers.
Why You Should Choose an Appraisers Association Member
Since the field of appraising requires no degree and no license, you should always ensure that any appraiser you work with is a member of the Appraisers Association of America. This credential will give you assurance that an appraiser of personal property is well qualified. All members are USPAP trained and known for holding high standards of ethics. For this reason, you can be confident that they are trustworthy.
There are four categories of professional members of the association. These categories are Certified Member, Life Certified Member, Accredited Member, and Life Accredited Member. A Certified Member holds the highest membership level in the association and has a designation of AAA following their name. This signifies that they have special expertise in a specific area.
The Appraisers Association of America is an international organization headquartered in New York City. Its members are residents of the U.S., Canada, Europe, and Asia. These appraisers value their membership in this global organization and represent it effectively and professionally.
The Profession of Appraising
There are five primary categories in the profession of appraisals. These designations are personal property, real estate, business assessment, machinery and equipment, and gems/jewelry. Most members of this association are personal property appraisers.
The majority of them are experts in the fine and decorative arts, jewelry, and household items. They may specialize in appraising drawings and paintings, watches and clocks, items of furniture, ceramics, and sculpture. Many appraisers have expertise in more than one area of property.
In addition, many of them hold certification in multiple areas of appraising. These appraisers may provide services for various purposes, including estate evaluations, tax, charitable, donations, insurance, liquidation, equitable, distribution, or purchase and sale.
Training to Become an Expert Appraiser
One way to become a professional appraiser is to complete the Comprehensive Appraisal Studies Program (CASP). The association also offers a two-semester online program.
An intensive summer course. methodology studies, and a connoisseurship program are also available. Some students also apprentice with an experienced appraiser before starting their own appraisal businesses.
Different Types of Appraisals: Practices and Procedures
Different types of appraisers must master various skill sets and knowledge to perform the practices and procedures of their profession. Essential skills needed include the following:
1. Personal Property Appraisals
A personal property appraisal may be needed for insurance or tax reporting purposes. The written result is similar to a legal document. It states the appraiser’s assessment of the monetary value of an item of personal property like a vehicle or a grand piano. Individuals often have personal property appraised for the purpose of obtaining an asset-based loan, using the item as collateral.
2. Real Estate Appraisals
An appraisal of real estate is a professional evaluation of a property. This assessment includes an analysis of the quality and market value of different aspects of the property. Realtors, property investors, and potential homebuyers hire the services of qualified appraisers before listing a property for sale or purchasing real estate.
3. Business Appraisals or Valuations
A business appraisal is a professional estimate of the overall monetary worth of a company. An appraisal is typically conducted prior to the purchase or sale of a business. Calculations of a company’s valuations are usually given as multiple times its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA).
4. Commercial Machinery and Equipment Appraisals
Appraisers of commercial machinery and equipment are trained and qualified to assess the value of a company’s operating equipment. They are prepared to conduct appraisals for a wide range of industries, including construction, metalworking, chemical, textiles, and food processing.
5. Appraisals of Gems and Jewelry
Appraisals of gems and jewelry can involve four varied types of values. These values are the replacement value, the fair market value, the wholesale value, and the liquidation or scrap value.
For example, if you want to use your jewelry to obtain an asset-based loan, you need the fair market value. Yet, if you wish to sell your gems or jewelry, you need an assessment of its wholesale, liquidation, or scrap value. Your expert appraiser can provide the best evaluation to satisfy your needs.
The Value, Intrigue, and Service of Professional Appraisals
The study and profession of appraisals is fascinating and challenging. It requires acquired knowledge, careful research, and a well-trained eye for detail. As a professional appraiser with excellent training and experience, you can enjoy a very interesting and rewarding career.
At the same time, you will be providing a valued and needed service to both businesses and individuals. Expert appraisals are needed every day of the year across the U.S. and worldwide. You can gain the great joy and satisfaction of providing your skills and expertise to people and companies in many varied locales while making new friends and enjoying diverse cultures and lifestyles.