RockSpringCluB-Hendricks Appraisal.pdf

THE COMPARATIVE APPROACH — AS A VALUATION INDICATOR As utilized in this report, the subject has been compared with similar properties recently sold. The Comparative Approach is based on the principle of substitution which implies that a prudent purchaser will not pay more to buy a property than it will cost to acquire a comparable substitute property. The price a typical purchaser pays is usually the result of a shopping survey in which available alternative properties have been compared. It is assumed, therefore, that the purchaser has an understanding of the real estate market. The sales comparison approach is defined as: “A set of procedures in which a value indication is derived by comparing the property being appraised to similar properties that have been sold recently, applying appropriate units of comparison, and making adjustments to the sale prices of the comparables based on the elements of comparison. The sale comparison approach may be used to value improved properties, vacant land, or land being considered as though vacant.” Source: The Appraisal of Real Estate — Twelfth (12") Edition, Published by the Appraisal institute - 2001 The comparable sales included in the report are sufficiently competitive with the subject of the appraisal so as to provide a basis for the valuation estimate. The extent of the research program and the scope of geographic investigation is considered appropriate for the type of property being appraised. The time frame is of adequate duration to provide a test for any temporary shift in supply and demand. The mechanics of the comparative adjustment can be accomplished in several ways. The most commonly used methods are: Whole Property Adjustments - Wherein a single lump sum adjustment is made in the comparative process. Dollar Adjustments - Wherein a table or grid of multiple adjustments in the form of dollar estimates is made in the comparative process. Percentage Adjustments - Wherein a table or grid of multiple adjustments in the form of percentages is made in the comparative process. In this appraisal | have employed a percentage adjustment. The major categories of adjustment has considered time, location and differences in physical characteristics with the adjustments being converted to a dollar conclusion. On the following pages will be found several transactions involving residential single

location and differences in physical characteristics with the adjustments being converted to a dollar conclusion. On the following pages will be found several transactions involving residential single family subdivisions located within the subject's general Northern New Jersey market area. These sales have been analyzed on a price per approved residential building lot and the concluded unit value has been applied to the subject's estimated sixty-six (66) potential residential building lots. It is readily acknowledged that while no single transaction can be considered conclusive evidence of Market Value, the combined weight of all of the sales data offers persuasive support for the valuation estimate contained herein. REAt ESTATE [ | APPRAISALS - 66 - a & RESEARCH