Scope of Work:
All income producing multifamily residential property shall be inspected and appraisal at market value. All building features, components, or characteristics as outlined in the commercial real appraisal section of this report shall be identified, measured and listed. Improvement unique to this class of real property including: all paved drives, swimming pools, patios, tennis courts shall be identified, measured, listed and appraised. The members of district staff which will be involved in the valuation of multifamily income producing properties include: the Assistant Chief Appraiser, commercial staff appraisers, and any other staff member deemed appropriate by the Chief Appraiser.
Data Collection and Validation:
The verified sales prices of vacant land and improved multifamily properties and other pertinent data shall be collected and maintained. Income parameters and data such as capitalization rates, income multipliers, equity dividend rates, marketing periods shall be identified, calculated, collected, and stored.
Other data collected and used in the valuation of multifamily properties includes actual income and expense data, actual contract rental data, leasing information (commissions, tenant finish, length of terms, etc.), actual construction cost data, and in-house surveys. In addition to the actual data obtained from specific properties, market data publications will be reviewed to provide additional support for market trends. Additionally, State Comptroller information, Institute of Real Estate Management (IREM) rental property surveys, ALN Apartment Data, TREPP LLC data resources, and web sites from real estate professionals will be reviewed. Available market extracted information, in addition to trade publications such as the Appraisal Institute’s (AI) Appraisal Journal and The Journal of Property Tax Administration from the IAAO will be used for research of appraisal methodology, capitalization rate development, and other pertinent real estate appraisal technical information.
Analysis and Valuation Procedures:
The analysis of highest and best use, area analysis, neighborhood analysis, market analysis, categorization procedure, field inspection technique, drive out procedure, and methods of valuation for multifamily income producing properties will be the same as outlined and described in the commercial property section of this report.
The income approach, cost approach, and sales comparison approach will be considered in arriving at the final property value when sufficient data is available. Income valuation models for multi-family properties will reflect multifamily type unit-of-comparison criteria unique to this property type. Income and expense data is often expressed in terms of “per units”. Data collected and utilized will express recognized market accepted units of comparison.
The district will utilize the district’s CAMA system and PC based software systems to assist in the collection of data and valuation of multifamily income producing properties.