Glossary of Terms
Note: This glossary is specialized for real estate appraisal practice within British Columbia. Terms and authoritative definitions may vary in other jurisdictions.
- Appraisal
- The act or process of developing an opinion of value; an opinion of value.
Source: USPAP - Appraiser
- One who is expected to perform valuation services competently and in a manner that is independent, impartial, and objective.
Source: USPAP - Agricultural Land Reserve (ALR)
- The total of all agricultural land in British Columbia; ALR designation and farm classification are separate determinations for assessment purposes.
Source: BC Assessment - Capitalization Rate
- The ratio of one year’s net operating income provided by an asset to the value of the asset; used to convert income into value.
Source: BC Assessment - Chattels
- An article of personal property, as distinguished from real property.
Source: BC Assessment - Client
- The party or parties who engage an appraiser by employment or contract in a specific assignment.
Source: USPAP - Common Area
- Any part of residential property the use of which is shared by tenants, or by a landlord and one or more tenants.
Source: BC Assessment - Common Property
- Part of the land and buildings shown on a strata plan that is not part of a strata lot.
Source: BC Assessment - Condition
- A qualitative measure of the overall desirability of a property’s physical improvements.
Source: BC Assessment - Confidentiality
- The fundamental appraiser obligation to protect the privacy of the client relationship and secure assignment results and non-public info from unauthorized access.
Source: USPAP - Cost to Cure
- Estimated cost to correct or replace a component within an item of property; the cost to remedy deferred maintenance or functional obsolescence.
Source: BC Assessment - Credible
- Worthy of belief. Credible assignment results require support by relevant evidence and logic, to the degree necessary for the intended use.
Source: USPAP - Depreciation
- The difference between the contributory value of an improvement and its cost at the time of appraisal.
Source: BC Assessment - Design
- The arrangement of elements or details in a structure, emphasizing functions, aesthetics, balance, and fitness for intended use.
Source: BC Assessment - Development Land
- Property which has a highest and best use for development into a higher density use, generally achieved through subdivision.
Source: BC Assessment - Dwelling
- A structure designed or occupied as the living quarters of one or more households, typically containing kitchen and bathroom facilities.
Source: BC Assessment - Easement
- A legal right to use, or to restrict the use of, the land of another person in some way.
Source: BC Assessment - Effective Age
- The age indicated by the condition and utility of a structure, based on an appraiser’s judgment and interpretation of market perception.
Source: BC Assessment - Effective Date
- The date to which an appraiser’s analyses, opinions, and conclusions apply; also referred to as the date of value.
Source: USPAP - Ethics Rule
- The overarching USPAP standard governing an appraiser’s obligation to promote public trust through integrity, impartiality, objectivity, independent judgment, and ethical conduct.
Source: USPAP - Excess Land
- Land that is not needed to serve or support the existing use, has the potential to be sold separately, and is valued separately.
Source: BC Assessment - Expert Witness
- An individual with specialized knowledge or experience called upon to provide professional, objective opinion evidence in legal proceedings.
Source: BC Assessment - Exposure Time
- An opinion of the length of time that the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date.
Source: USPAP - External Obsolescence
- A type of depreciation caused by negative factors outside the property boundaries (e.g., location near nuisance uses) which are generally incurable.
Source: BC Assessment - Extraordinary Assumption
- An assignment-specific assumption as of the effective date regarding uncertain information which, if found to be false, could alter the appraiser’s opinions or conclusions.
Source: USPAP - Fee Simple
- The absolute form of property ownership, granting the owner maximum control, usage, and transfer rights subject only to public powers and registered encumbrances.
Source: BC Assessment - Functional Obsolescence
- A loss of value resulting from deficiencies or outdated concepts inherent within the property itself, such as layout or aesthetic elements.
Source: BC Assessment - Hypothetical Condition
- A condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis.
Source: USPAP - Improvements
- Any building, fixture, or structure constructed or placed on or in land, or on water over land for assessment purposes.
Source: BC Assessment - Intended Use
- The use(s) of an appraiser’s reported appraisal or appraisal review assignment results, as identified by the appraiser based on communication with the client at the time of the assignment.
Source: USPAP - Intended User
- The client and any other party as identified, by name or type, as users of the appraisal or appraisal review report by the appraiser, based on communication with the client.
Source: USPAP - Interim Use
- The temporary use to which a site or improved property is put until it can be fully developed to its prospective highest and best use.
Source: BC Assessment - Lease Interest
- The ownership interest held by the landlord, encapsulating the right to receive contract rent and reversion of the property upon lease expiration.
Source: BC Assessment - Life Estate
- An interest in real property that exists only for the duration of a designated person’s lifetime.
Source: BC Assessment - Lot
- A distinct parcel of land defined within a legal description identifying the precise boundaries of a property.
Source: BC Assessment - Manufactured Home
- A dwelling built in a factory on a chassis designed to be transported for onsite use; subject to specific BC registration requirements.
Source: BC Assessment - Market Value
- Market value is defined as “the most probable price, as of a specified date, in cash, or in terms equivalent to cash, or in other precisely revealed terms, for which the specified property rights should sell after reasonable exposure in a competitive market under all conditions requisite to a fair sale, with the buyer and seller each acting prudently, knowledgeably, and for self-interest, and assuming that neither is under undue duress."
Source: BC Assessment - A type of value, stated as an opinion, that presumes the transfer of a property as of a certain date, under specific conditions set forth in the value definition identified by the appraiser.
Source: USPAP - Outliers
- Data points in a valuation study that fall significantly outside the normal range, typically analyzed for exclusion or refinement in mass appraisal.
Source: BC Assessment - Partial Interest Sale
- The purchase or transfer of a divided or undivided right representing less than the 100% fee simple interest in real estate.
Source: BC Assessment - Personal Property
- Any tangible or intangible article that is subject to ownership and not classified as real property.
Source: USPAP - Price
- The amount asked, offered, or paid for a property. Once stated, price is a historical fact and may not relate to the value derived through methodology.
Source: USPAP - Range of Value
- The total spectrum of probable value indications derived via comparable analysis prior to reaching a final valuation conclusion.
Source: BC Assessment - Real Estate
- An identified parcel or tract of land, including improvements, if any.
Source: USPAP - Real Property
- The interests, benefits, and rights inherent in the ownership of real estate.
Source: USPAP - Renovation
- Changes and upgrades intended to modernize or refresh the condition, functionality, or aesthetic appeal of an existing property.
Source: BC Assessment - Replacement Cost
- The estimated current cost to construct a substitute building of similar utility using modern materials, layout, and current standards.
Source: BC Assessment - Reproduction Cost
- The estimated current cost to construct an exact replica of an existing structure using the same materials, design, and craftsmanship quality.
Source: BC Assessment - Restrictive Covenant
- A legal charge registered on title that dictates or limits the use of the land or structures that can be established upon it.
Source: BC Assessment - Retrospective Value
- An opinion of value as of a specific prior date, effectively providing a valuation snapshot in the past.
Source: USPAP - Riparian Rights
- The legal rights belonging to an owner of land bordering a waterway, granting reasonable utilization of the water resources.
Source: BC Assessment - Scope of Work
- The type and extent of research and analyses performed in an appraisal or appraisal review assignment.
Source: USPAP - Single Family Dwelling
- A residential structure primarily designed and intended to accommodate one distinct family or household unit.
Source: BC Assessment - Site Improvements
- Modifications to the land itself (paving, utilities, drainage, grading) that enhance its utility but are external to the building envelope.
Source: BC Assessment - Statutory Right of Way
- A specialized easement granted to public bodies or utilities to maintain infrastructure upon private land indefinitely.
Source: BC Assessment - Surplus Land
- Land not currently needed to support existing improvements which cannot be legally severed or sold independently.
Source: BC Assessment - Tenancy in Common
- A co-ownership structure where owners hold separate, undivided interest lacking the right of survivorship characteristic of joint tenancy.
Source: BC Assessment - Workfile
- The documentation, data, and supporting materials necessary to support an appraiser’s analyses, opinions, and conclusions for the required records-retention duration.
Source: USPAP - USPAP
- The Uniform Standards of Professional Appraisal Practice. Developed by The Appraisal Foundation, these comprise the recognized ethical and performance standards for the appraisal profession.
Source: USPAP - Zoning Bylaw
- A municipal regulation detailing permissible land use, density requirements, setbacks, and structural development allowances.
Source: BC Assessment