What process is used to arrive at one estimate of value after using all three appraisal approaches?

The process used to arrive at one estimate of value after utilizing all three appraisal approaches—cost, sales comparison, and income—is known as reconciliation or correlation. This step is vital in the appraisal process, as it allows the appraiser to analyze the different values derived from the three methods and determine a final value conclusion that best reflects the property's worth.

Reconciliation involves weighing the relevance and reliability of each approach based on the type of property being appraised and the availability of data. For instance, if the appraiser finds that the sales comparison approach yields a value that is consistent with the income approach but diverges significantly from the cost approach, they would assess the circumstances surrounding each method to justify the final value. The appraiser will consider factors such as market conditions, property type, and the purpose of the appraisal.

This final estimate is usually articulated as a single value that represents their professional opinion, taking into account all three methodologies. Therefore, reconciliation or correlation is a critical component of the appraisal process, synthesizing the information into a cohesive conclusion regarding the property's value.