MARKET VALUE: a type of value, stated as an opinion, that presumes the transfer of a property (i.e., a right of ownership or a bundle of such rights), as of a certain date, under specific conditions set forth in the definition of the term identified by the appraiser as applicable in an appraisal.
Comment: Forming an opinion of market value is the purpose of many real property appraisal assignments, particularly when the client’s intended use includes more than one intended user.
The conditions included in market value definitions establish market perspectives for development of the opinion. These conditions may vary from definition to definition but generally fall into three categories:
- the relationship, knowledge, and motivation of the parties (i.e., seller and buyer);
- the terms of sale (e.g., cash, cash equivalent, or other terms); and
- the conditions of sale (e.g., exposure in a competitive market for a reasonable timeprior to sale).
Appraisers are cautioned to identify the exact definition of market value, and its authority,applicable in each appraisal completed for the purpose of market value.
(UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE, 2010-2011 ed.)