In the world of writing Appraisal Reports, the appraiser is sometimes faced with determining how the Appraisal should be delivered to the client. When reporting the results of an Appraisal, there are three available options:

• Oral Appraisal Report
• Restricted Appraisal Report
• Appraisal Report

For all three options, the appraiser(s) must maintain a workfile. Before we get into the specifics, we must distinguish between an “Appraisal” and a “Report”.

APPRAISAL: (noun) the act or process of developing an opinion of value; an opinion of value. (adjective) of or pertaining to appraising and related functions such as appraisal practice or appraisal services.

Comment: An appraisal is numerically expressed as a specific amount, as a range of numbers, or as a relationship (e.g., not more than, not less than) to a previous value opinion or numerical benchmark (e.g., assessed value, collateral value).

REPORT: any communication, written or oral, of an appraisal or appraisal review that is transmitted to the client or a party authorized by the client upon completion of an assignment.

Source: Definitions section of the Unform Standards of Professional Appraisal Practice (USPAP), 2024 Edition.

To put it simply:

• An Appraisal is an opinion of value developed by an appraiser that can be delivered orally, or in writing.
• A Report is the method by which the Appraisal is delivered.

Oral Appraisal Report
The client only receives the Appraisal orally; nothing in writing can be delivered. The results can be delivered in person, a virtual meeting, or by a telephone call. Here are some examples of when this method of reporting the Appraisal might be appropriate.

• Setting a listing price for real property.
• Appealing a property’s assessed value. If the Appraisal favors the client, a written report is usually required.
• Assisting brokers with pricing. With a reduced scope of work, this option is usually more cost-effective.
• Settling disputes among opposing parties.

Often, an Oral Appraisal Report leads to written reports which are discussed next.

Restricted Appraisal Report
Examples of when this method of reporting might be appropriate:

• Setting a listing price for real property.
• Appealing a property’s assessed value.
• Assisting brokers with pricing.
• Settling disputes among opposing parties.

Distinguishing Between the Two Written Options
For the two written report options, a Restricted Appraisal Report requires the least level of detail (content). Most of the content of the report are statements of fact, rather than an in-depth discussion and/or analysis of the opinions reached in the Appraisal.

Examples of when this option might not be appropriate.

• Litigation
• Tax Appeal
• Eminent Domain
• Mortgage Lending
• Estate Tax Appraisals

Appraisal Report
Level of detail involved more of a summary level of content at a minimum. The content depends on the intended use of the assignment (what will it be used for). This is the most common report type.

This reporting option is appropriate for any intended use. This option is intended to provide sufficient detail for the client and intended user to fully understand the results of the Appraisal. This option was once called a Summary Appraisal Report or Self-Contained Appraisal Report. The latter implies that the content has a sufficient level of detail for the client and intended users of the Appraisal. The report stands on its own and needs no supplement.

In the ideal world, the choice of which report option is best for a particular assignment should be a mutually agreed upon. USPAP has always encouraged dialogue between the client and appraiser. The majority of Appraisals are completed for lending purposes. Therefore, the Appraisal Report is the most common report option.

John Bosworth is a Certified USPAP Instructor by the Appraiser Qualifications Board since 2002. John has taught this subject matter for the Appraisal Institute and a variety of other course providers. He is Senior Managing Director of Valbridge Property Advisors | Charlotte.

The information contained in this publication is for informational and educational purposes only. It is not financial, legal, or other professional advice, and you may not rely on it for any purpose. To secure professional advice for your particular situation, you must engage one or more appropriate professional advisors to advise you about your situation.