Appraisers typically rely on the sales comparison approach to develop an opinion of value. Appraisers get to know the neighborhoods in which they work in. They understand the value of certain features to the residents of that area. The appraiser researches recent sales in the vicinity and finds properties which are ''comparable'' to the subject being appraised. The sales prices of these properties are used as a basis to begin the sales comparison approach.
Using knowledge of the value of certain items such as gross living area, condition and quality (just to name a few), the appraiser adjusts the comparable properties to more accurately portray the subject property.
In the case of income producing properties - rental houses for example - the appraiser may use a third approach to valuing the property. In this case, the amount of income the property produces is used to arrive at the current value of those revenues over the foreseeable future.
